Sanofi deal a welcome shot in the arm for Malin investors

Shareholders in Malin will see some concrete return on their investment this year as the company returns money to them following the sale of core investment Kymab to French drug giant Sanofi.

It will be a welcome development for shareholders who have struggled over the past three years as the shares traded below the price at which they floated back in early 2015.

The Irish-listed life sciences investment group has had a stake of around 10 per cent in the Cambridge-based start-up that has been working towards a treatment for eczema.

Sanofi has snapped up the company for a $1.1 billion payment up front, and as much as $350 million in potential earnouts. The French company clearly sees strong potential in the company’s antibody therapy, even though Kymab has yet to put the drug into late-stage trials.

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The sale will see Malin get an initial payout of $112 million, with maybe as much as $33 million more to come if it delivers. In euro terms that would be just shy of €120 million all told.

Davy analyst Andrew Young described the outcome as an excellent result, noting the uplift potential for the company's share price. The shares did jump on Monday, but only by 10 per cent to €4.40, still well below Young's fair value estimate of €8.50.

Davy, which is company broker to Malin, said shareholders can expect to see a payout of close to €50 million based on Monday’s share price. That would be welcome but with the company’s market cap sitting at around €200 million, they still have some way to go to recoup the €400 million invested in the business to date.