The laboratory testing group says it will be able to run the European pharmaceuticals business better once it owns the entire group.
The writedown of the “majority” of the stake’s carrying value follows Nuvisan struggling since ALS, which tests everything from coal to drugs, acquired the 49 per cent stake.
“We have an insight of the business that normally you don’t have with acquisitions,” ALS chief executive Malcolm Deane told“We believe we can run this business better than our existing partner. That we can create efficiency returns that we expect for our shareholders.”was designed to boost its exposure to markets such as in contract research for pharmaceutical giants.
But given the losses, acquiring that remaining stake cost nothing. Asked if ALS had tried selling its stake, Mr Deane said: “If the best outcome for the shareholders would have been divesting that business, we would have done that immediately, but we thought that the best outcome … was really running this company in a different way.”
Carter Bar Securities analyst Peter Drew said time would tell whether Nuvisan proved a bad or good investment for ALS, but added the company “has demonstrated consistently they are very good at managing costs”.
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