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Carlsquare Equity Research welcomes the appointment of Anna Linton (formerly Unimedic/MedCap) as the new CEO of Pharmiva. We see it as an essential step to strengthen the company’s ability to launch internationally. The news should support interest in the ongoing issue via TO3 warrants (subscription price SEK 5.72), which run until 8 April.
New Qualified CEO Appointed
Pharmiva announces that Anna Linton has been appointed as the new CEO to succeed Christina Östberg Lloyd, who announced her resignation in November 2021. Linton most recently comes from a similar position at Unimedic Group, which is part of listed MedCap. Unimedic Group had a turnover of SEK 317 million in 2021 and develops and distributes specialist pharmaceuticals and is also a contract manufacturer of pharmaceuticals. Since 2018, Unimedic’s EBITDA margin has tripled. Anna Linton has also previously been CEO of, among others, the medical device company Grunenthal’s Nordic operations when the company underwent a successful turnaround. She will take up the position on 8 August.
We are pleasantly surprised by the recruitment of a person with extensive experience and a solid track record in pharmaceutical sales and the development and optimisation of distribution chains. Unimedic focuses on the Nordic business, but the company also has small sales in the rest of Europe. We guess that formulating a strategy for the launch of Vernivia outside Sweden will be high on the new CEO’s priority list. We are not making any changes to our estimates at this stage but emphasise that the timing and design of the international launch significantly impact our forecasts and valuation of the company.
The Subscription Period for TO3 Ends on 8 April
Overall, we believe it is a good signal that the CEO issue is now resolved. Currently, the exercise period for TO3 warrants is running, with each warrant entitling the holder to subscribe for one share for SEK 5.72 per share, which is about 25 per cent lower than the current price of the Pharmiva share. The last day to subscribe for shares via TO3 is April 8. If fully subscribed, Pharmiva will receive SEK 6.2 million before issue costs. Pharmiva has entered into a top-down guarantee of SEK 3.1 million, which means that the warrants will be fully exercised provided that the subscription rate is at least 50 per cent.
Please also read our Initiation analysis from 25 January 2022 here. We calculate a fair value of SEK 18.2 per share in a base case scenario.
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