Perrigo To Buy Omega Pharma For $4.5 Billion
Irish consumer healthcare firm Perrigo announced that it will acquire the Belgian OTC healthcare products provider Omega Pharma for $4.5 billion (3.6 billion euros).
Under the terms of the agreement, Perrigo will purchase Omega’s equity for 2.48 billion euros and will assume 1.1 billion euros in debt. Perrigo said the acquisition will improve its over-the-counter (OTC) product offering and enlarge its distribution capabilities through Omega’s platform, which has a presence in 35 countries.
Bloomberg reports that to assure the cash portion of the transaction, Perrigo secured a 1.75 billion euro bridge facility from JPMorgan Chase & Co. and Barclays. Perrigo Chairman, President and CEO Joseph C. Papa, said, “We believe this strategic transaction will enhance shareholder value by further strengthening our industry-leading revenue and cash flow growth profile and by expanding market opportunities. Omega brings a leading OTC product portfolio, European capabilities, and a highly experienced management team to support Perrigo's continued growth.”
Perrigo stated that its acquisition ushers it into the $30 billion OTC market in Europe, which it considers to have a high-barrier to entry. Perrigo also gained an additional 2,500 employees and a sales team of 1,100 from Omega. Omega is the fifth largest player in the European OTC market, bringing in an estimated $1.6 billion in revenue since last year until September 2014. The company holds an estimated 2,000 products ranging from treatments for cough and cold, to skincare products, gastrointestinal drug brands, and pain relief medicines.
“Since our founding in 1987, we have been relentlessly executing our pharmacist-focused growth strategy across Europe. We have successfully developed a top OTC product portfolio and a leading European commercial infrastructure. This is an exciting time in the history of our company,” said Omega Founder and CEO Marc Coucke.
The companies said the transaction is expected to be completed in the first quarter of 2015.