Warnex says suitors interested in remaining divisions

Contract services firm Warnex says its analytical and bioanalytical divisions have attracted ‘interest’ from buyers that would exceed its current market cap.

The Canadian firm has undertaken a drastic restructuring programme since December last year, beginning with the sale of its medical labs business – which provides prenatal testing, molecular diagnostics, paternity and forensic services - to Gamma-Dynacare Medical Laboratories.

That left Warnex with just its bioanalytical arm – which provides bioequivalence and bioavailability testing services for trials – and its analytical services business.

Warnex did have a buyer lined up for its analytical services business later that month.

However, that deal collapsed in February this year with Warnex accusing the buyer of failing to comply with obligations set out under the takeover agreement

New suitors

Warnex has not disclosed further details of the potential new suitors, only revealing that it “has received a number of non-binding expressions of interest with respect to potential transactions involving each of these divisions” in a statement issued earlier this week.

It added that: “The prospective purchasers are currently in the process of conducting due diligence reviews of their target operations,” but cautioned that there is no guarantee that any deal will be completed.

Despite the lack of specifics the announcement gave Warnex' share price a considerable boost on March 26 from investors keen to cash in on any deals that to emerge.

But while there seems to be some hope – at least for shareholders – the clock is ticking as Warnex faces delisting from the Toronto Stock Exchange (TSX) next month after failing to meet the index’ minimum listing requirements.

The firm said that it “continues to actively explore other means of maintaining the value and liquidity of its common shares” but added that it “cannot ensure that the Common Shares will be listed on an exchange after April 2.”

Speaking to Outsourcing-pharma.com in February Warnex said that it was seeking a listing of its share on another exchange