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Sweden’s EQT in talks with Dechra over cash bid

Swedish private equity firm EQT is in talks with Dechra Pharmaceuticals over a possible £4.6 billion cash bid, in a deal backed by the Abu Dhabi Investment Authority, according to a report by The Times. A takeover of Dechra, the FTSE 250 veterinary drugs company, would cap a rollercoaster period for the group, which was briefly promoted to the FTSE 100 after its shares soared on a pandemic-driven pets boom but which have halved since a peak two years ago.

Dechra is led by Ian Page, who has been chief executive since soon after the Cheshire-based company was listed in 2000. Dechra, advised by Investec, said it had entered into discussions over a possible all-cash offer of £40.70 per share and was prepared to recommend the deal to its shareholders should EQT make a firm offer. It said: “There can be no certainty that any firm offer will be made for Dechra.”

EQT, founded almost three decades ago and with an office in the UK, manages assets worth €210 billion across private equity, infrastructure and real estate.

The possible offer from EQT would be at a premium of almost 49 per cent to Dechra’s share price, which closed up by 86p, or 3.2 per cent, at £27.76 before the announcement. The shares peaked at about £54 in 2021 after the pandemic led to an increase in pet ownership and spending on pets.

Dechra has grown in the fragmented market through bolt-on acquisitions under Page, who retains a stake worth about £16.5 million.

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