Fighting talk from Axis-Shield on Alere bid

MEDICAL testing kit maker Axis-Shield will come out fighting today when it publishes its defence against a £230 million takeover bid from US rival Alere.

Half-year results issued yesterday by the Dundee-based firm gave a strong indication of the battle lines being drawn, with the focus on the company’s Afinion equipment, which can run several tests on the same sample, and a lipid test being introduced on the machine for heart and lung disease.

Chief executive Ian Gilham said the company was still on course to launch its lipid test in Europe before the end of the year. He said the firm would also seek regulatory approval in the first half of next year to sell the test in the United States. The forthcoming lipid test is expected to rival Alere’s own products.

The lipid market is expected to be worth $500m (£305m) by 2013, compared with the $350m diabetes area, in which Axis-Shield already operates.

Alere spokeswoman Ginny Pulbrook said the New York-listed company’s 460p-a-share cash bid offered certainty to investors in Axis-Shield. She added: “Shareholders are being asked to put their faith in a management team who have a track record of not delivering on expectations.”

Pulbrook pointed to analysts downgrading pre-tax profit forecasts and problems Axis-Shield has had with gaining regulatory approval in the US in the past.

But Gilham hit back, defending his team’s record. He said: “History is history. But where we are today, with these results and with our outlook being strong, we’re in a good position to deliver growth in value for shareholders.”

Underlying profits in the six months to 30 June jumped 57.4 per cent to £4.3m on the back of a busier flu season and stronger sales of its own-brand, higher-margin products. Sales rose by 10.4 per cent to £56.2m.

Julie Simmonds, an analyst at Collins Stewart, said a takeover bid of up to 580p – valuing the firm at about £295m – would be “a more-reasonable value”. The shares closed up 2.5p at 478p.