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(Sharecast News) - Eco Animal Health announced on Wednesday that it has sold certain non-core product lines to its long-term distribution partner in South Africa for £0.49m, further streamlining its focus on the treatment and prevention of disease in pigs and poultry.
The AIM-traded firm said the disposed ECOmectin licences, which cover anti-parasitic treatments for sheep and cattle in southern Africa, had been considered non-core to the business for some time.
It said the transaction represented a one-time consideration in place of past and future royalties, with no royalties recorded in the year ended 31 March 2024.
Eco said its distribution partner had been manufacturing and selling the products under licence for more than 20 years.
Proceeds from the sale would be reinvested in the company's research and development pipeline, particularly in new vaccines and preventative treatments.
Subject to shareholder approval, a portion of the funds could also be allocated to a share buyback programme to meet potential employee share incentive obligations.
"The disposal of these non-core assets aligns with our focus on swine and poultry and our commitment to invest in our research and development pipeline," said chief executive officer David Hallas.
"We are pleased that the licences will be further developed by a committed owner.
"We continue to look for value accretive licensing opportunities both within our portfolio and outside and for opportunities to reinvest in the R&D pipeline to support future growth."
At 1417 GMT, shares in Eco Animal Health were up 0.61% at 58.86p.
Reporting by Josh White for Sharecast.com.
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