Perrigo to raise €800m for takeover

Leading generic drugs producer, Perrigo is set to raise approximately $1bn (€800m) — via a share placing — to mainly cover the cost of its proposed takeover of Belgian firm, Omega Pharma Invest NV.

Perrigo to raise €800m for takeover

Perrigo is ranked as the number one maker of generic over-the-counter drugs in the US and, last year, moved its corporate headquarters to Dublin following its $9.5bn purchase of Irish biotechnology firm, Elan.

It emerged earlier this month, that Perrigo has reached agreement to buy Omega for €3.6bn, including debt (the price includes the assumption of €1.1bn of debt), a deal which will significantly boost its foothold in the European healthcare market, and place it among the top-five largest over-the-counter treatment providers in the world.

It will also allow Perrigo easier access to European pharmacies, as the Belgian firm already has direct relationships with more than 200,000 owners.

“Omega instantly enhances our scale and broadens our footprint, providing us with immediate access to an established commercial network,” Perrigo’s chief executive, Joe Papa told investors earlier in the month.

Perrigo yesterday announced a share offering of just over 6.8m ordinary shares, which will raise around $1bn.

If the takeover does not conclude, the money will go to debt repayment, investment in subsidiaries, capital expenditure and general corporate purposes.

Formed in 1987 by two former pharmacy students at Ghent University, and taken private in early 2012 after 13 years as a public company, Omega operates in 35 countries and has a portfolio of around 2,000 prescription-free treatment products for such diverse uses as pain relief, weight control, gastrointestinal needs, skincare, pain relief and coughs and colds. Between them, Omega and Perrigo had combined revenues of nearly $6bn last year.

Back in August, Perrigo reported a 54% drop in net income for the 12 months to the end of June, to $205.3m (€154m).

While the company incurred once-off costs of over $200m from its purchase of Elan, the benefits of that deal have already begun to materialise. Those annual results from Perrigo also detailed a jump – from $3.54bn to nearly $4.1bn – in yearly net sales, while fourth quarter figures (both income and revenue) were boosted partially by sales and royalties from Elan’s former multiple sclerosis treatment, Tysabri. Perrigo is also set to benefit from around $150m in annual tax savings from acquiring Elan and having its tax base in Ireland, rather than the US.

More in this section

IE_180_logo
Price info

Subscribe to unlock unlimited digital access.
Cancel anytime.

Terms and conditions apply

The Business Hub
Newsletter

News and analysis on business, money and jobs from Munster and beyond by our expert team of business writers.

Sign up
Puzzles logo
IE-logo

Puzzles hub

Visit our brain gym where you will find simple and cryptic crosswords, sudoku puzzles and much more. Updated at midnight every day. PS ... We would love to hear your feedback on the section right HERE.

Lunchtime
News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up
Revoiced
Newsletter

Our Covid-free newsletter brings together some of the best bits from irishexaminer.com, as chosen by our editor, direct to your inbox every Monday.

Sign up