 "Hikma Pharma buys Roxane Labs from Boehringer Ingelheim in a $2.65-bn deal")
The UK-based Hikma Pharmaceuticals Plc on July 28, 2015 announced that it has agreed to acquire specialty generics company Roxane Laboratories from Boehringer Ingelheim for about $2.65 billion in cash and stock to bolster its presence in the US. Under the terms of the acquisition, on closing of the transaction Hikma will pay gross consideration of $1.18 billion in cash and will issue 40 million new Hikma shares to Boehringer (representing approximately 16.71 per cent of Hikma’s issued share capital immediately following closing and admission).
“Based on an agreed issue price for the new Hikma shares of Pound 23.50 per share and the US:GBP exchange rate of 1.56:1, the aggregate value of the gross consideration payable on closing is approximately $2.65 billion. Hikma has also agreed to make contingent cash payments of up to $125 million, subject to the achievement of certain performance milestones,” said Hikma in a press release.
The acquisition will establish Hikma as the sixth largest company (by revenue) in the US generics market. Roxane will add significant breadth to Hikma’s US portfolio, bringing 88 highly differentiated products in specialised and niche segments of the market, including oncology, respiratory, extended release and controlled substances. Post-acquisition, Roxane will target revenue of $725 million to $775 million in 2017 and an EBITDA margin of around 35% over the medium-term.
Said Darwazah, chief executive officer of Hikma, commented, “This transaction has significant strategic value for us, transforming our position and scale in the US generics market. Roxane’s impressive portfolio, attractive pipeline and R&D expertise, focusing on higher value, niche and differentiated products, will create a platform for sustainable long-term growth. The acquisition also significantly expands our manufacturing capacity and technological capabilities. Roxane has an excellent team of highly skilled employees and we are very excited about the value they will bring to Hikma.”
Roxane, founded in 1885 as The Columbus Pharmaceutical Company, was purchased by Boehringer in 1978 at which point its name was changed to Roxane Laboratories Inc. At present, Roxane has 1,360 employees and a manufacturing site in Columbus, Ohio.
In recent years, Hikma, a leading pharmaceutical manufacturer in MENA and emerging markets, has rapidly expanded its presence in the US generics market. Hikma is now a leading player in the US generic injectables market, reflecting strong organic growth and the successful acquisition and integration of the MSI and Bedford Laboratories businesses.
“Based on an agreed issue price for the new Hikma shares of Pound 23.50 per share and the US:GBP exchange rate of 1.56:1, the aggregate value of the gross consideration payable on closing is approximately $2.65 billion. Hikma has also agreed to make contingent cash payments of up to $125 million, subject to the achievement of certain performance milestones,” said Hikma in a press release.
The acquisition will establish Hikma as the sixth largest company (by revenue) in the US generics market. Roxane will add significant breadth to Hikma’s US portfolio, bringing 88 highly differentiated products in specialised and niche segments of the market, including oncology, respiratory, extended release and controlled substances. Post-acquisition, Roxane will target revenue of $725 million to $775 million in 2017 and an EBITDA margin of around 35% over the medium-term.
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“Boehringer’s approximate 16.71 percent equity stake reflects a shared conviction in the future growth potential of the Hikma Group and allows Boehringer to focus on growing its global core businesses,” added the release.
Said Darwazah, chief executive officer of Hikma, commented, “This transaction has significant strategic value for us, transforming our position and scale in the US generics market. Roxane’s impressive portfolio, attractive pipeline and R&D expertise, focusing on higher value, niche and differentiated products, will create a platform for sustainable long-term growth. The acquisition also significantly expands our manufacturing capacity and technological capabilities. Roxane has an excellent team of highly skilled employees and we are very excited about the value they will bring to Hikma.”
Roxane, founded in 1885 as The Columbus Pharmaceutical Company, was purchased by Boehringer in 1978 at which point its name was changed to Roxane Laboratories Inc. At present, Roxane has 1,360 employees and a manufacturing site in Columbus, Ohio.
In recent years, Hikma, a leading pharmaceutical manufacturer in MENA and emerging markets, has rapidly expanded its presence in the US generics market. Hikma is now a leading player in the US generic injectables market, reflecting strong organic growth and the successful acquisition and integration of the MSI and Bedford Laboratories businesses.