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Cello Health strengthens position in healthcare advisory market

Snapshot

  • Two divisions: Cello Health and Cello Signal
  • The group's dividend has risen every year for the past 13 years
  • Expansion in the US is key to future growth
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Quick facts: Cello Health PLC

Price: 161 GBX

AIM:CLL
Market: AIM
Market Cap: £178.84 m
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What Cello Health does

Cello Health PLC (LON:CLL) calls itself a healthcare-focused advisory group.

It has two arms: Health, which provides expertise, processes, intellectual property and market knowledge spanning the pharmaceutical, biotechnology, diagnostics, healthcare equipment and consumer health sectors.

And Signal, which provides “digital, social media and branding expertise” to companies, and is increasingly focused on health having previously been focused sectors such as technology and retail.

Cello’s big claim to fame is that it works with 24 of the top 25 pharmaceutical companies around the world.

 

How it is doing

In June, Cello received a takeover offer by private equity firm Arsenal Capital partners valuing the firm at £178.8mln, or 161p per share, a 44% premium to the previous day's closing price.

The board have unanimously recommended the deal, which has also received irrevocable undertakings and letters of intent from 35.2% of shareholders.

 

What the boss says: Mark Scott, chief executive

“The Cello directors are confident that, as part of the value demonstration platform with Arsenal's backing, Cello will be optimally positioned to accelerate its current strategy and capitalise on a broader range of opportunities.”

 

 

 

What analysts say

“We expect the deal to complete and is another positive sign for the industry that it remains attractive and open for deals after Huntsworth was also taken out by PE in early March - although it’s worth noting that the high profile deals this year have been driven by relatively new PE funds,” analysts at Liberum said.

The broker added that Huntsworth was acquired in March by Clayton, Dublilier and Rice and there have been several private trade sales recently to private equity.

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