Date: 2014-07-14
Type of information: Pipeline acquisition
Acquired company: Abbott's non-U.S. developed markets specialty and branded generics business (USA - IL)
Acquiring company: Mylan (USA - PA)
Amount: $5.3 billion (€3.9 billion)
Terms: * On February 27, 2015, Mylan announced the successful completion of the acquisition of Abbott Laboratories' non-U.S. developed markets specialty and branded generics business. Under the previously announced terms of the transaction agreement, Abbott received 110 million shares of Mylan N.V. , resulting in former Mylan Inc. shareholders now owning approximately 78% of Mylan N.V. and Abbott now owning approximately 22% of Mylan N.V. Mylan Inc. and Abbott's non-U.S. developed markets specialty and branded generics business have been reorganized under Mylan N.V. , a new public company organized in the Netherlands . Mylan N.V. will be led by the former Mylan Inc. executive team. The company will trade on Nasdaq under the ticker symbol MYL. * On July 14, 2014, Mylan announced that it has entered into a definitive agreement with Abbott whereby Mylan will acquire Abbott\'s non-U.S. developed markets specialty and branded generics business in an all-stock transaction. Upon closing, Abbott will receive 105 million shares of the combined company worth approximately $5.3 billion based on Mylan\'s closing price of $50.20 on Friday, July 11, 2014 , representing an approximately 21% ownership stake. The transaction will instantly further diversify Mylan\'s business and strengthen its commercial platform outside the U.S., building new opportunities for growth and additional sales channels in the acquired markets. It also is expected to provide Mylan with significant additional financial firepower to pursue future opportunities, an additional $600 million of annual post-close EBITDA, an optimized global tax structure and enhanced balance sheet capacity. Abbott will carve out the Assets and transfer them to a new public company (\"New Mylan\") organized in the Netherlands . Immediately following the transfer, Mylan will merge with a wholly owned subsidiary of New Mylan, and New Mylan will become the parent company of Mylan. The new public company will be called Mylan N.V. and will be led by the current Mylan leadership team and headquartered in Pittsburgh. Under the terms of the transaction agreement, Abbott will receive 105 million shares of New Mylan upon closing, resulting in Mylan shareholders owning approximately 79% of New Mylan and Abbott indirectly owning approximately 21% of New Mylan. Mylan shareholders will recognize gain for U.S. federal income tax purposes on the exchange of Mylan common shares for New Mylan ordinary shares. Shares of New Mylan will continue to trade in the U.S. on the NASDAQ under Mylan\'s existing ticker symbol MYL. The transaction has been unanimously approved by Mylan\'s Board of Directors and is expected to close in the first quarter of 2015, subject to certain closing conditions, including regulatory clearances and approval by Mylan\'s shareholders. The transaction is expected to be immediately and significantly accretive to Mylan, with expected year one adjusted diluted EPS accretion of approximately $0.25 , increasing thereafter through 2018. The combination is expected to deliver in excess of $200 million in pre-tax operational efficiencies by the end of year three post-close. Centerview Partners served as financial advisor to Mylan, and Cravath, Swaine & Moore LLP served as its legal advisor.
Details: The assets, which are being acquired on a debt-free basis, include an attractive portfolio of more than 100 specialty and branded generic pharmaceutical products in five major therapeutic areas (cardio/metabolic, gastrointestinal, anti-infective/respiratory, CNS/pain and women\'s and men\'s health) and include several patent protected, novel and/or hard-to-manufacture products with continued growth potential. With a strong presence in Europe , Japan , Canada , Australia and New Zealand , the assets are expected to provide approximately $1.9 billion in annual additional revenues at deal close. The business includes an active sales organization of approximately 2,000 representatives in more than 40 non-U.S. markets, as well as two high-quality manufacturing facilities.
The transaction further diversifies Mylan\'s business outside of the U.S. by adding a differentiated and attractive portfolio of durable specialty and branded generic products and providing entry into the over-the-counter market. Key products include Creon®, Influvac®, Brufen®, Amitiza® and Androgel®, among others. The addition of the Assets also enhances Mylan\'s geographic reach and provides Mylan with enhanced scale and critical mass in Mylan\'s largest markets outside of the U.S. The transaction is expected to approximately double Mylan\'s revenues in Europe by strengthening its presence in Italy , the United Kingdom , Germany , France , Spain and Portugal , among others. It also is expected to more than double Mylan\'s revenues in Canada and Japan , and build on Mylan\'s business in Australia and New Zealand . The transaction also provides Mylan with a meaningful presence in the specialty and branded generics market in Central and Eastern Europe .
Related: Generics
