Biopharmaceutical company Mallinckrodt plc (NYSE: MNK) is selling its wholly owned subsidiary BioVectra Inc. to an affiliate of H.I.G. Capital for $250 million.
This will include fixed consideration of $175 million: an upfront payment of $135 million, a long-term note for $40 million and contingent payments of up to $75 million.
"This transaction continues to advance Mallinckrodt's strategic focus on branded, high-growth biopharmaceuticals by monetizing a non-core business," CEO Mark Trudeau said in a statement.
"While we recognize the longer-term growth potential for BioVectra, we believe that the structure of this deal enables us to participate in the future success of the business, and therefore we see this sale as the best option for both Mallinckrodt and BioVectra moving forward."
Mallinckrodt shares were trading up 12.86% at $2.37 in Tuesday’s premarket session. The stock has a 52-week high of $34.11 and a 52-week low of $1.43.
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