Advising on the disposal of medical imaging company

24 Oct 2017

Simmons & Simmons has advised the shareholders of Intelligent Ultrasound Limited (IUL), a University of Oxford spin-out company that develops image analysis software for ultrasound, on the disposal of the company to MedaPhor Group plc (MedaPhor), the AIM-quoted global provider of advanced ultrasound skills training simulators for medical professionals.

The transaction, which completed on 6 October, took place alongside an institutional placing by MedaPhor which raised £5.5m before costs, to finance the enlarged group's new product development plans and working capital requirements.

The initial consideration due on completion was satisfied by the issue and allotment of new ordinary shares in MedaPhor, subject to a retention in respect of one third of the new ordinary shares in MedaPhor to be issued as part of the initial consideration. The retained shares will be issued on the first anniversary of completion. In addition, deferred consideration may also be payable by MedaPhor subject to certain targets of IUL being met. The deferred consideration would be satisfied predominately by the issue of additional shares in MedaPhor.

Given the range of sellers, the extent to which they were seeking certain tax reliefs, the existing interests of some of them in MedaPhor shares and the need to maintain an orderly market in the new ordinary shares in MedaPhor being issued, the transaction documentation contained complicated consideration, warranty, limitation of liability and protection of goodwill provisions. The option holders in IUL have also agreed to exchange their existing options for new options in MedaPhor.

Commenting on the transaction, Jocelyn Ormond, Partner at Simmons & Simmons, said: “We are pleased to have been able to assist IUL and its numerous shareholders through this complex transaction, drawing on our wide experience of acting on other M&A transactions in the life sciences and healthcare sectors. IUL is at the forefront of research and development in relation to artificial intelligence in the imaging space.”

The Simmons & Simmons team was led by Jocelyn Ormond (Partner) and Dan Whitewood (Corporate Supervising Associate) and assisted by Zoe Arnautov (Tax Managing Associate), Matthew Norris (Tax Supervising Associate) and Tair Hussain (Corporate Pensions & Incentives Managing Associate) as well as a number of the Firm’s lawyers from other practice areas.

Memery Crystal and Cenkos advised MedaPhor.

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