Krakow, Poland – May 26, 2020 – The shareholders of Selvita S.A. [ticker: WSE:SLV] – one of the largest preclinical contract research organizations in Europe, have made a decision to go ahead with the issue of no more than 2.38 million C series shares, which constitutes about 15 percent of the current Company’s share capital. The proceeds from the offering will be primarily allocated to acquisitions, as well as further organic development of Selvita.

The issue of shares will be carried out in the form of a prospectus-free, public, Follow-On offering and will be addressed to qualified investors as well as non-qualified investors who will subscribe for shares equal to at least the equivalent of EUR 100,000 per investor.

The book-building process will start tomorrow, May 27. The issue resolution assumes a priority right, which execution will allow the current shareholders who are considered qualified investors, to maintain their current shareholding level in Selvita. IPOPEMA Securities S.A. acts as global coordinator and bookrunner, and Chabasiewicz Kowalska & Partners law firm acts as the legal advisor.

Selvita plans to dedicate the proceeds from the offering, i.e. approx. EUR 21 m, to the acceleration of Company’s development and increase of its scale of operations on the global market.

For the past year Selvita has been growing at a 40% rate. We’re getting ready to continue our dynamic development also in the upcoming years. The acquisitions we have planned, will allow us to strengthen our position on the global market. These will allow us not only to continue this dynamic  increase in the scale of our business, but also further complement our competences. We will allocate the vast majority of proceeds from the current issue of shares to this purpose – comments Bogusław Sieczkowski, co-founder and Chief Executive Officer at Selvita.

In recent weeks, Selvita has published the Development strategy for 2020-2023. The execution of the new strategy assumes that in 2023 the Company will be able to achieve over EUR 70 million in revenues at a stable EBITDA margin, as well as  a market cap of over EUR 230 million. At the same time, thanks to planned investment expenditures, Management hopes that Selvita will be able to strengthen its position on the market and as a result achieve in the mid-term, the position among TOP10 global preclinical CROs.  

One of the major assumptions for further Selvita growth is the execution of acquisitions of selected preclinical CRO companies which will either complement the current Company offering, or will allow for the expansion of its scale of operations. The initial transactions will involve smaller entities with stand-alone revenues in the range of EUR 2-20 million. Among the qualitative criteria for choosing the acquisition target, Selvita will favor entities supplementing their portfolio of services in the area of drug discovery or regulatory services. By the end of 2023, the Company intends to execute three acquisitions, with the first one taking place this year.

In years 2020-2023, the Company plans to allocate EUR 35-50 million to the M&A activities. In order to execute it, Selvita plans to allocate the majority of the proceeds from the Follow-On offering of C series shares i.e. ca. EUR 16 million, to this purpose.

Selvita development strategy includes the creation of Selvita Research Center, as an element of further organic growth, with a research area of ​​4000 m2. With the completion of the new Center, Selvita will have 10,000 m2 of research space available. Own laboratories and strengthening the scientific staff, will allow Selvita to increase its scale of business, expand its services offer and launch innovative new services. Initiation of the investment is planned for next year, and expected to be finalized at the turn of 2022 and 2023.

Approximately EUR 5 million proceeds from the C series share issue will be dedicated to this purpose. The remaining value of the investment expenditure will be financed mainly by bank loans, grant financing and own resources.

Forward-Looking Statements

This release may contain forward-looking statements, including, among other things, statements regarding the guidance from management and financial results. Selvita cautions the reader that forward-looking statements are not guarantees of future performance. Forward-looking statements involve known and unknown risks, uncertainties and other factors which might cause the actual results, financial conditions, performance or achievements of Selvita, or industry results, to be materially different from any historic or future results, financial conditions, performance or achievements expressed or implied by such forward-looking statements. In addition, even if Selvita’s results, performance, financial conditions, and the development of the industry in which it operates are consistent with such forward-looking statements, they may not be predictive of results or developments in future periods. Given these uncertainties, the reader is advised not to place any undue reliance on such forward-looking statements. These forward-looking statements speak only as of the date of publication of this document. Selvita expressly disclaims any obligation to update any such forward-looking statements in this document to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements, unless specifically required by law or regulation.