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On Thursday, Berenberg issued a rating downgrade for Alliance Pharma (LON:ALAPH) shares, moving from Buy to Hold. The firm also adjusted the price target to GBP0.63 from the previous GBP0.70. The change follows the announcement made on January 10, 2025, by DBAY Advisors, which outlined a recommended cash offer for Alliance Pharma at 62.5p per share. This offer represented a 41% premium over the stock’s closing price on the day before the announcement and valued the company at approximately GBP 349.7 million.
Berenberg’s decision to downgrade is influenced by the likelihood that the acquisition will proceed, considering the board’s support and DBAY Advisors’ significant shareholding. At the time of the bid, DBAY Advisors held a 27.9% stake in Alliance Pharma. The analyst at Berenberg reflected this sentiment in their commentary, stating that the expected closure of the deal has led to the revised rating and price target.
The new price target of 62.5p aligns with the bid price proposed by DBAY Advisors. The offer has garnered the board’s endorsement, which is a critical factor in the anticipated successful completion of the deal. The acquisition, if finalized, would result in DBAY Advisors taking control of Alliance Pharma at the stated offer price.
Investors and shareholders of Alliance Pharma are now observing the situation as the proposed acquisition progresses. The support from the board and the substantial existing ownership by DBAY Advisors suggest that the acquisition is poised to move forward without significant barriers.
The market is expected to continue monitoring Alliance Pharma as the acquisition by DBAY Advisors unfolds. The company’s share price and trading activity will likely reflect the ongoing developments related to the proposed deal.
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