Ardana calls on MoFo in search for merger

UK pharmaceutical company Ardana has called on Morrison & Foerster (MoFo) as it seeks a buyer or merger partner to raise money for research.

Ardana’s share price has fallen 70 per cent in the past six months, leading the board to announce that it is willing to sell or merge the company to help fund drug development.

The news comes amid a flurry of activity in the UK life sciences sector. In early February MoFo advised CeNeS Pharmaceuticals, a developer of central nervous system drugs, in takeover talks with an unnamed buyer.

MoFo corporate partner James Gubbins is the firm’s relationship partner for Ardana. He said many small UK pharmas were resorting to mergers in a bid to fund research.

“It is difficult to raise money on the market,” he added. “These companies need cash to develop their programmes. We will see continuing M&A activity within the sector.”

MoFo has represented Ardana, which specialises in reproductive health, since acting on its flotation in March 2005. The firm won a place on the pitch through a recommendation by non-executive director John Brown, who used MoFo when he was chief executive at vaccine developer Acambis.

Dundas & Wilson is Ardana’s main adviser in Scotland, where the company is based.

Any takeover bid would be expected to offer significantly more per share than the current price, which has been falling since early last year, said Gubbins.

On 22 February Ardana was valued at £12.12m on the London Stock Exchange.