InDex Pharmaceuticals has entered into a conditional agreement to acquire all shares in Flerie Invest AB.

Flerie will become a wholly-owned subsidiary of InDex Pharmaceuticals and Flerie’s shareholders will initially hold approximately 91.9% of the total number of shares and votes in the company, prior to the completion of the capital raise. As a result of the transaction, the company will change its name to Flerie AB (“New Flerie”).

Flerie is valued at approximately SEK 3,073 million in the transaction, based on reported net asset value as of 31 March 2024 with a discount of 10%. InDex Pharmaceuticals is valued at approximately SEK 269 million, corresponding to the company’s estimated cash position after closing costs with a premium of 20%, which entails a subscription price of approximately SEK 0.506 per consideration share.

”I am very pleased that the evaluation has resulted in the proposed transaction, as Flerie came out as the best option. Flerie has a highly regarded board and management with excellent track record​ and a balanced risk profile. The attractive deal terms include a possibility for share redemption, in addition to being able to trade which ensures that we can offer shareholders optionality,” says Jenny Sundqvist, CEO of InDex Pharmaceuticals.

New Flerie

As part of the transaction and the continued financing of New Flerie, a number of institutional investors, including the company’s existing shareholders the Fourth Swedish National Pension Fund, HBM Healthcare Investments, Linc AB and SEB Stiftelsen, have undertaken to subscribe for new shares in the company in a directed share issue.

Through this, the company will raise in aggregate approximately SEK 520 million before transaction costs.

This broadening of our shareholder base and becoming listed is a key step in Flerie’s plan to create a new model for life science investing: We continue our long-term, active investment strategy, while offering new shareholders access to and liquidity in difficult-to-assess biotech companies.”

”This broadening of our shareholder base and becoming listed is a key step in Flerie’s plan to create a new model for life science investing: We continue our long-term, active investment strategy, while offering new shareholders access to and liquidity in difficult-to-assess biotech companies. The transaction and the capital raise allow accelerated development of a risk-diversified portfolio of product development and commercial growth companies spanning obesity, diabetes, heart disease, cancer and autoimmune disorders to pharmaceutical manufacturing services, diagnostics, medical devices and tools,” states Ted Fjällman, CEO of Flerie and intended CEO of New Flerie.

A new model for life science investing

NLS asked Ted Fjällman to describe the benefits of this new model for life science investing and of their IPO.

“We wanted to go public because our model is to remain a long-term biotech investor that creates value, and we do not want be forced to sell assets or shut down projects prematurely when we still can create more value. However, shareholders must be able to get a return and most cannot wait 10 years. By being listed we can create long-term value and remain an evergreen investor that takes an active role, while shareholders can trade freely via the stock exchange. I think it is a very interesting model, especially for life science investments, because our portfolio of 29 companies also creates a more constant news flow compared to just a single biotech company,” says Fjällman.

I think it is a very interesting model, especially for life science investments, because our portfolio of 29 companies also creates a more constant news flow compared to just a single biotech company.”

Being listed is workable because those who invest in Flerie know that we will be listed, which facilitates the acquisition of capital, adds Fjällman. “In our case, you also get capital assets in the bargain, as well as a broad shareholder base of both institutional and retail investors, and it also helps that the liquidity and free float have an advantage compared to a normal IPO.”

The Board of Directors of New Flerie shall consist of Flerie’s current Board: Thomas Eldered, Cecilia Edström, Anders Ekblom and Jenni Nordborg, with Thomas Eldered as chairman. Following completion of the Transaction, Flerie’s CEO Ted Fjällman will be appointed CEO of New Flerie and Flerie’s CFO and deputy CEO Cecilia Schéele will be appointed CFO and deputy CEO of New Flerie.

Future plans

NLS asked Ted Fjällman which life science companies and which areas of life sciences that are most interesting to invest in.

“There are many interesting areas, and then there are interesting areas that we do not understand, so I only mention interesting areas that we do understand: Pioneering drug development based on the societal changes that we see, i.e. companies that not only perform exciting research but also have applications that are absolutely necessary for our society to function. To be more specific, within areas such as obesity, diabetes, and heart failure it is absolutely fundamental to find better solutions,” he says.

To be more specific, within areas such as obesity, diabetes, and heart failure it is absolutely fundamental to find better solutions.”

What are your hopes and expectations when it comes to Flerie’s continued journey?

“We want to build on our internationalization because it will help our companies make deals with global pharma and enable us to bring in more co-investors. Flerie is unfortunately a rare item in Europe, and Sweden in particular. When our approach becomes even more successful I look forward to seeing copy cats, in the same area or in other areas where development takes a long time and our model would fit,” says Fjällman.

Photo of Ted Fjällman: Flerie Invest