2 May 2008

Sareum Holdings PLC

("Sareum" or "Company")

Strategic Review

 

Sareum Holdings plc (AIM:SAR), the specialist structure-based drug discovery business, announces that the Board is undertaking a strategic review to consider how best to take the business forward.

Sareum, which was formed in August 2003, employs a structure-based approach to the discovery of new drugs for the treatment of cancer.  In parallel, the Company provides specialist drug discovery capabilities to partners in the pharmaceutical and biotechnology industries.  The Company has historically been funded via fee-for-service-contract revenues and funds raised through equity issues.

The strategic review has been initiated by the Sareum Board for a number of reasons, inter alia;

  • Difficult trading conditions resulting from a reticence in the research service sector, particularly in the USA, to use cash reserves to sponsor new research activities until financial conditions improve.  Combined with a high level of M&A activity within the pharmaceutical and biotechnology sector, this has tended to interfere with the decision making process for the initiation of new research programs.  This was highlighted in Sareum’s interim results statement for the six months ended 31 December 2007 which was released on 6 March 2008.

 

  • The current depressed share price in common with most "small cap" plcs; and

 

  • The Board has received approaches from parties interested in the Company’s drug discovery business and in-house cancer drug discovery programs. 

 

The Sareum Board will be considering a number of options including; the sale of all or part of the business, the raising of additional equity funds, entering into partnering arrangements, or the acquisition of a suitable business to give the Company additional critical mass.  The Board has appointed Grant Thornton Corporate Finance as financial advisers to assist with this process.

 

The Sareum Board intends to complete this evaluation process to ensure that the future strategy adopted is in the best interests of both shareholders and employees.  As and when a decision on the optimum future strategy for the Company is reached, if appropriate, an announcement will be made.

Accordingly, under the rules of the Takeover Code, Sareum is now in an offer period.  Sareum confirms, pursuant to Rule 2.10 of the City Code on Takeovers and Mergers, that its issued share capital as at 2 May 2008 comprised 818,097,713 ordinary shares of 0.025 pence each.  The shares are traded on AIM under International Securities Identification Number GB00B02RFS12.

Dealing Disclosure Requirements

Under the provisions of Rule 8.3 of the Takeover Code ("the Code"), if any person is, or becomes, "interested" (directly or indirectly) in 1% or more of any class of "relevant securities" of Sareum, all "dealings" in any "relevant securities" of that company (including by means of an option in respect of, or a derivative referenced to, any such "relevant securities") must be publicly disclosed by no later than 3.30 pm (London time) on the London business day following the date of the relevant transaction.  This requirement will continue until the date on which the offer becomes, or is declared, unconditional as to acceptances, lapses or is otherwise withdrawn or on which the "offer period" otherwise ends.  If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire an “interest” in "relevant securities" of Sareum, they will be deemed to be a single person for the purpose of Rule 8.3.

Under the provisions of Rule 8.1 of the Code, all "dealings" in “relevant securities" of Sareum by any offeror, or by any of its respective "associates", must be disclosed by no later than 12.00 noon (London time) on the London business day following the date of the relevant transaction.

A disclosure table, giving details of the companies in whose "relevant securities" "dealings" should be disclosed, and the number of such securities in issue, can be found on the Takeover Panel’s website at www.thetakeoverpanel.org.uk.

 "Interests in securities" arise, in summary, when a person has long economic exposure, whether conditional or absolute, to changes in the price of securities. In particular, a person will be treated as having an "interest" by virtue of the ownership or control of securities, or by virtue of any option in respect of, or derivative referenced to, securities.

Terms in quotation marks are defined in the Code, which can also be found on the Panel’s website.  If you are in any doubt as to whether or not you are required to disclose a "dealing" under Rule 8, you should consult the Panel.

ENDS

For further information:

Sareum Holdings plc                                                                  01223 497700    

Tim Mitchell, Chief Executive Officer

 

Buchanan Communications                                                        020 7466 5000

Tim Anderson, Mary-Jane Johnson


Grant Thornton Corporate Finance                                              

Charles E Cattaneo                                                        07774 276512

Philip Secrett,                                                                020 7383 5100

Colin Aaronson                                                    

 

Sareum Holdings plc is a structure-based drug discovery business headquartered in Cambridge, UK. The Company was formed in August 2003 to discover new drugs for the treatment of cancer.  Sareum’s unique approach aims to halve the time it takes to discover new drug candidates.

A structure-based approach to drug discovery relies on knowledge of the three-dimensional structure of the proteins that cause disease.  Once the structure is known, potential drugs are designed to ‘lock-in’ to the protein with the aim of reversing or arresting a disease’s progression.  Knowledge of the structure of the potential drugs and how they ‘lock-in’ to their target protein assists greatly in the development of high-quality drug candidates.  Determining structure is a complex task and requires leading-edge equipment and experienced staff.  Sareum’s approach to structure determination utilises its proprietary protein expression platform in order to produce multiple recombinant proteins that accelerate structure determination using x-ray crystallography.

Once the structure is determined, the Company’s innovative fragment screening platform is used to identify novel chemical templates designed to interact with the target protein.  Sareum then uses its high-throughput medicinal chemistry platform to rapidly optimise these molecules and develop the most promising into potential drug candidates.

Sareum aims to successfully deliver drug candidates for licensing to larger pharmaceutical companies at the pre-clinical or early clinical trials stage.  This is funded by provision of its specialist drug discovery capabilities to partners in the pharmaceutical and biotechnology industries.

Sareum joined the AIM market of the London Stock Exchange in October 2004 and trades under the symbol SAR.  For further information, please visit www.sareum.co.uk