Date: 2016-07-21
Type of information: Company acquisition
Acquired company: Relypsa (USA - CA)
Acquiring company: Galenica Group (Switzerland)
Amount: $1.53 billion
Terms:
- • On July 21, 2016, Galenica Group and Relypsa announced that the companies have entered into a definitive agreement under which Galenica will acquire Relypsa. This transaction further strengthens Galenica's Business unit, Vifor Pharma, as the company will gain full global rights to the potassium binder Veltassa® (patiromer) for oral suspension and enhance its growing position as a global specialty pharmaceutical company. Under the terms of the merger agreement, Galenica will pay $32 per share in cash, or a total of approximately $1.53 billion. Through this acquisition, Vifor Pharma will gain a fully-integrated commercial organization in the United States and significantly strengthen its presence in the U.S. cardio-renal market, a key area of focus.
Under the terms of the merger agreement, Galenica will commence a tender offer to acquire all of the issued and
outstanding common stock of Relypsa for $32 per share. The implied fully-diluted equity value of the offer amounts to $1.53 billion. The Boards of Directors of both Relypsa and Galenica have approved the terms of the merger agreement, and the Board of Directors of Relypsa has resolved to recommend that shareholders accept the offer, once it is commenced.
The acquisition is structured as an all-cash tender offer for all outstanding issued common stock of Relypsa followed by a
merger in which remaining shares of Relypsa would be converted into the same U.S. dollar per share consideration as in the tender offer. The transaction is not subject to a financing condition.
Vifor Pharma intends to retain the Relypsa leadership team in order to support the integration of Relypsa into Vifor Pharma,
as well as the ongoing business and future development of Veltassa. Credit Suisse acted as the sole financial adviser to Galenica for this transaction. Centerview and BofA Merrill Lynch acted as financial advisers to Relypsa. Jones Day acted as the legal adviser to Galenica for this transaction. Latham & Watkins LLP acted as legal adviser to Relypsa.
Galenica has secured committed bridge loan financing from Credit Suisse which, in addition to the Galenica existing cash
and cash equivalents, is available to finance the transaction.
Galenica plans to refinance a portion of the bridge loan through equity proceeds to be raised in conjunction with the
envisaged division of the Group in the course of 2017, either through an initial public offering of Galenica Santé or through
another option such as an equity increase. Galenica intends to raise sufficient equity to maintain implied investment grade
ratings at both Vifor Pharma and Galenica Santé in the medium term after the separation of the Group.
Details: The transaction provides Vifor Pharma with full global rights to Veltassa®. It will also significantly enhance the commercial visibility and presence of Vifor Pharma in the key cardio-renal market in the United States, where Relypsa has already established a significant and powerful specialist sales force. With the combination of the assets and products of Vifor Pharma, Vifor Fresenius Medical Care Renal Pharma (VFMCRP) and Relypsa, Vifor Pharma is positioned to become a major player in the United States in its core therapy areas.
The acquisition of Relypsa is expected to significantly strengthen Vifor Pharma ahead of the planned division of the Galenica Group into two independent companies in 2017, with an extensive specialist product portfolio to include both the
intravenous iron deficiency treatment Ferinject® (ferric carboxymaltose) and Veltassa®.
Relypsa is a biopharmaceutical company based in Redwood City, with more than 400 employees. The company, founded in 2007, is focused on the discovery, development and commercialization of polymeric medicines for patients with conditions that can be addressed in the gastrointestinal tract. Its lead product, Veltassa®, was approved by the FDA for the treatment of hyperkalemia in October 2015. Veltassa is the first medicine for
treatment of people with elevated blood potassium levels to be approved in the United States in more than 50 years and the
only hyperkalemia medicine with long-term data in its label supporting chronic use. Relypsa has developed an extensive
specialist commercial organization in the United States targeting nephrologists and cardiologists and focused on developing
market access and awareness.
In August 2015, VFMCRP acquired the commercial rights to Veltassa outside the United States and Japan. Through the
acquisition, Vifor Pharma will acquire the global rights to Veltassa.
Related: Kidney diseases - Renal diseases - Gastrointestinal diseases
Is general: Yes
