Print“This acquisition will significantly enhance and broaden Abbott's Latin American footprint, and is well aligned with our long-term strategy and commitment to fast-growing markets, says Miles White, CEO of Abbott.”
A few months after abandoning its $1.2 billion effort to buy South African pharmaceutical Adcock Ingram, Chilean drugmaker CFR Pharmaceuticals is itself being bought by Abbott Laboratories in a deal valued at $2.9 billion. Currently focused on heart stents, diagnostics, and nutritional beverages, the deal boosts Abbott’s pharmaceutical business, which has been limited to branded generics since it spun out its innovative drugs operation into AbbVie at the end of 2013.
Under the terms of their deal, Abbott will acquire the holding company that indirectly owns approximately 73 percent of CFR Pharmaceuticals and then conduct a cash tender offer for the remaining outstanding shares. Abbott expects to pay $2.9 billion for CFR, plus the assumption of about $430 million of net debt.
The acquisition of CFR more than doubles Abbott’s Latin American branded generics presence and places Abbott among the top 10 pharmaceutical companies in Latin America, adding about $900 million to its sales in 2015 with double-digit sales growth over the next several years.
“With its scale and leadership positions in the region, strong commercial and development organizations, well-respected leadership team and a trusted portfolio of recognized brands, CFR is one of the leading branded generic companies in Latin America,” says Miles White, chairman and CEO of Abbott. “This acquisition will significantly enhance and broaden Abbott's Latin American footprint, and is well aligned with our long-term strategy and commitment to fast-growing markets.”
Headquartered in Santiago, Chile, CFR Pharmaceuticals derives most of its revenue in Colombia, Chile, and Peru. Its product portfolio is aligned with Abbott’s current pharmaceutical therapeutic focus in areas of women's health, central nervous system, cardiovascular, and respiratory diseases.
The Latin American pharmaceutical market is expected to reach $73 billion in sales this year, and is expected to reach $124 billion by 2018, with estimated annual growth rates of two to three times that of developed markets over the coming years, according to IMS forecasts.
Abbott plans to fund the transaction with cash on the balance sheet and expects it to close at the end of the third quarter of 2014.
May 16, 2014
http://www.burrillreport.com/article-abbott_buys_chile%e2%80%99s_cfr_pharmaceuticals_for_2_9b.html
