Malin Corporation revealed on Thursday it spent almost €4.8 million buying back some of its own shares this week at €6 each, a little over a month after closing the sale of its stake in Kymab, a firm developing a potentially lucrative eczema treatment.
It marked the first share buyback by the State-backed life sciences investment company since it floated on the stock market in 2015, taking advantage of how the stock continues to trade at a discount to what Malin estimates to be its real value.
The company put the stock’s intrinsic value at €9.32 at middle of March.
Malin received a $113 million (€95 million) upfront payment last month as French drugs giant Snafu bought Kymab, in which Malin owned a 10 per cent stake, in a deal worth as much as $1.45 billion. It will deliver up to $33 million in follow-on payments to the Dublin-listed company, subject to certain milestones being met.
Return of capital
Sources said that this week’s share buyback was not the beginning of Malin’s long-awaited large return of capital to shareholders on foot of the Kymab deal.
The board has still not yet decided whether it will go down the route of a share buyback programme or special dividend, they said. The Ireland Strategic Investment Fund (ISIF) owns 10.9 per cent of the company.
Malin, which had €23 million of cash on its balance sheet at the end of 2020, said in April that it planned to immediately start to the process of repaying €45 million of European Investment Bank borrowings before a making large-scale shareholder distribution.