Shares in Sinclair IS Pharma (SPH:AIM) shot up 8% to 38.6p in early trading after the skin care specialist sold a non-core business for more than half the group’s market cap.

The non-aesthetics products and brands have been sold to Alliance Pharma (APH:AIM) generating £132 million cash for the £192 million cap. The acquirer falls 9.3% to 46.2p on the news.

The deal, which involved wound care products, was sold on more than three times sales for 2015. Under terms of the agreement, Sinclair is set for undisclosed royalty payments on sales of burns treatment Flammacerium in the US.

Web - Sinclair IS Pharma - 26 Nov 2015

Analysts at N+1 Singer said the deal ‘represents excellent shareholder value’.

The new debt-free Sinclair is now a pure-play aesthetics business with five brands. It intends to launch minimally invasive facelift specialist Silhouette in the US in the second quarter of 2016. The company has £82 million cash following the deal.

Issue Date: 26 Nov 2015