£20m deal for firm that does chicken feed

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The Independent Online

Lawrence, the company that specialises in feed and health treatments for animals, is close to striking a £20m deal to buy out its partners.

It has drawn up heads of agreement with Michael Sanders, a director of its main subsidiary, Eco Animal Health, to buy the 50 per cent stake he owns with his family and suppliers.

The listed company expects to sign the agreements next month. Mr Sanders and the other investors will receive around £20m in cash and shares for the stake in the subsidiary. The deal will help the group focus on its growing animal health division, which should soon provide the bulk of its profits.

In May, European regulators approved the sale of Aivlosin, a drug to treat chicken and pigs with pneumonia. The drug, which the company hopes will achieve $150m (£84m) of sales by 2007, could also get approval as a treatment for lung and stomach diseases in chickens.

Lawrence has been selling Aivlosin in Asia and Latin America for around 10 years. The latest approval means animals which have been treated with the drug can be sold in the largest markets, Europe and the US. Peter Lawrence, the chairman and founder, said: "Aivlosin will be the main growth driver for the group."

As part of the company's restructuring, it is also in talks to sell its Blackfast Chemicals unit, which blackens metal components to protect them from corrosion, as it is non core. The division is worth around £1.5m and a deal should be completed early next year.