Wound care specialist Advanced Medical Solutions (AMS) is proposing to acquire RESORBA, a wound care business, for €63.8m (£55m).
To fund the acquisition the firm is placing over 42m shares in AMS at a price of 73p per share to raise £34m.
The acquisition is expected to be earnings per share enhancing in the twelve months ending 31 December 2012.
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Chris Meredith, chief executive officer of AMS said: "Part of our core growth strategy has been to examine potential acquisition opportunities that strengthen our business with complementary technologies and greater market access, specifically in relation to the operating room segment of our global business."
The share price rose 13.1% to 82p by 15:25.
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