Date: 2016-12-15
Type of information: Company acquisition
Acquired company: BioPhausia (Sweden)
Acquiring company: Karo Pharma (Sweden)
Amount: SEK 908 million (€ 91.92 million)
Terms:
- • On December 15, 2016, Medivir announced that the divestment of BioPhausia to Karo Pharma has been completed. The Board of Directors of Medivir will convene an
Extraordinary General Meeting (EGM), and proposes that the EGM resolves to transfer the net proceeds from the sale of BioPhausia (approx. SEK 870 m, corresponding to SEK 32/share) to the company’s shareholders through a voluntary share redemption offer open to all shareholders.
• On November 1, 2016, Medivir announced that the company has entered into an agreement with Karo Pharma AB regarding the sale of Medivir’s subsidiary BioPhausia AB (Nordic Brands) to Karo Pharma. The purchase price will be SEK 908 million (€ 91.92 million) on a cash and debt free basis, including a normalized working capital. The transaction is expected to close by mid-December 2016.
- As previously communicated, the Board of Directors of Medivir tasked the management to investigate a separation of the group’s operations into two independent companies, with the aim to separately list the commercial operations. In the meantime, the Nordic Brands portfolio (BioPhausia AB) has attracted significant interest from several prospective buyers. In a structured process of evaluating a sale versus a separate listing, the Board of Directors of Medivir has concluded that a divestment of BioPhausia to Karo Pharma is the best alternative for BioPhausia, Medivir and its shareholders.
The transaction entails a divestment of 100 per cent of the shares in Medivir’s wholly owned subsidiary BioPhausia AB for a purchase price of SEK 908 million on a cash and debt free basis including normalized working capital. Transaction costs are estimated to approximately SEK 25 million. The separation process and operational realignment as a consequence of the sale will result in additional one off costs of approximately SEK 15 million. The employees that today serve this operation are not part of the transaction, and approximately 10 employees will therefore unfortunately have to leave Medivir after the transaction.
The purchase price will be paid in cash only.
Based on the purchase price of SEK 908 million (€ 91.92 million), the transaction will increase the net result for the consolidated Medivir and the parent company Medivir AB with approx. SEK 530 million and approx. SEK 300 million respectively. Furthermore, the transaction will strengthen the cash position, after setting aside an escrow amount during warranty period of twelve months, with approx. SEK 780 million.
The Board of Director’s intention is to recommend, following a review of the capital need, that excess proceeds as a result of the divestment should, to the extent possible, be distributed to the shareholders, by way of dividend or otherwise. Medivir has engaged Carnegie Investment Bank as financial adviser and Vinge as legal adviser in connection with the transaction.
Details:
- BioPhausia consists of thirteen established pharmaceutical drugs with strong brand names. The company offers products for various therapeutic areas, including pain, respiratory tract, cardiovascular, inflammation, trauma, GI tract, muscle, and psychiatry, as well as provides minerals. The company’s products comprise Citodon, Digoxin BioPhausia, Egazil, Laxabon, Mollipect, Morfin special, Nitroglycerin BMM Pharma, Paraflex, Probecid, Solvezink, Suscard, Teovent, Lithionit, and Theo Dur. For the period of Q3-2015 to Q2-2016, BioPhausia generated revenues of SEK 189 million.
Related:
Is general: Yes
