UCC among backers to share €80m as campus startup sold

THE €80m sale of Cork-based PrecisionBiotics is set to benefit shareholders including University College Cork (UCC), Enterprise Ireland and dozens of private investors alongside top executives at the probiotic gut health company.

Stock market-listed Danish biotechnology group Novozymes is buying the Cork company for €80m to expand its business in the area of biological solutions for mouth and gut health.

PrecisionBiotics was spun out from UCC in 1999 as Alimentary Health. Its patented probiotics are used in treatments, including for the symptoms of irritable bowel syndrome, which affects as many as 15pc of adults, including around twice as many women as men.

Its over-the-counter health products include Zenflore and Alflorex.

As a one-time campus startup, the company retains close ties to UCC, which held a 5.38pc stake in the business ahead of its sale.

Other shareholders include PrecisionBiotics CEO Barry Kiely, who has an almost 12pc stake, its CFO Brian Barrett and his wife with an almost 22pc stake and UCC-based microbiologist Liam O’Mahony with a 12.96pc shareholding.

The company’s most recent annual return lists 36 pages of shareholders, mostly private individuals in Ireland, but including specialist life sciences venture capital investor Seroba Bioventures Limited.

Mr Kiely, the CEO and co-founder of PrecisionBiotics Group, said merging with Novozymes will give the Irish business a global presence.

“This will help us to grow by developing new products where we can combine enzymes and probiotics,” he said.

The sale to Novozymes will see the Danish firm buy 100pc of the equity in PrecisionBiotics Group for €80m on a cash and debt-free basis.

There is also an earn-out, which means senior management are likely to have committed to remain with the business for a period.

The deal is the biggest yet among microbiology startups spun out of the Irish universities sector.

Two years ago Trinity-linked Nuritas hit the headlines when that biotech firm, which uses data mining of molecules in food to develop supplements and medical treatments, secured a €30m loan from the European Investment Bank (EIB).

‘This will help us to grow by developing new products’