Shareholders of Bulgaria’s leading generic drugs producer Sopharma (3JR BU) and Unipharm (59X BU) approve merger, according to а regulatory note from the two extraordinary shareholders’ meetings held on 23rd Feb 2018. Pursuant to the vote, and based on the fair value of the merger agreement, one Unipharm common share will be exchanged for 0.891512 shares of Sopharma. Pursuant to the transaction finalization Unipharm will merge into Sopharma and cease to exist as a separate entity.
Sopharma – first to introduce semiannual dividend payments
In addition, Sopharma’s shareholders approved semiannual dividend payments as part of the Company’s Articles of Association as well as a renewal of the share buyback program. Thus, Sopharma can start semiannual dividend payments after approving its semiannual financial statements as stipulated by the latest changes in the local legal framework.
Share buy-back program extended
Also, Sopharma’s shareholders approved an extension of its share buy-back program for another five years. Accordingly, the Company could buy back up to 10% of its share capital, with up to 3% per year, at a maximum price of BGN 5.50 per share and a minimum of BGN 1 per share (the nominal value of the stock).
CEO Donev with news on investment and employee stock plan
Post the shareholders meeting, Sopharma’s CEO Ognyan Donev held an additional meeting with shareholers where he disclosed that Sopharma is also planning an employee share bonus program using part of the bought back stock. No immediate details available on the employee stock plan. As of Feb. 8th, 2018, Sopharma holds 8 904 000 bought back shares, representing 6.61% of the registered capital.
Finally, Donev also discussed upcoming investment plans. As Sopharma’s American partner Achieve Life Sciences (NASDAQ: ACHV) has published positive results of its Phase I/II clinical study on smoking cessation drug cytisine, Donev expressed optimism towards the development of Achieve’s next steps, including its Phase III clinical study. The latter is expected to start in mid-2018 and can take up to 18 months to be finalized. Nevertheless, Sopharma has already started preparation to enlarge its cytisine extraction capacity via adding additional land to plant the trees from which the ingredient is extracted as well as add more extraction capacity in the town of Kazanlak.
Additionally, Sopharma is proceeding with the construction of additional lyophilic production plant in Sofia. The latter is expected to cost c. BGN 30m. Donev added that the overall investment in the two production facilities would amount to BGN 40-50m. Also, he expressed positive expectations for the performance of Sopharma’s key Russian and Ukrainian markets, forecasting them to keep the 2017 momentum in 2018 in terms of sales revenue for the Group.