United Drug agrees $61m Indian deal

United Drug is set to strengthen its packaging and speciality services division with the $61m (€49.5m) cash acquisition of the US and European operations of Indian healthcare services giant, Bilcare Ltd.

The purchase of international clinical trials-related business, Bilcare Global Clinical Supplies will position the Dublin-headquartered healthcare services group as a global leader in both commercial and clinical packaging. The deal is expected to be formally concluded by the end of this month and the consideration — payable upon deal completion — will be financed through United Drug’s internal resources and existing debt facilities.

Bilcare GCS has assets of $16m and, in its last financial year generated profits of $4.6m. The development will see Bilcare Ltd — which is headquartered in the Indian city of Pune — focus on its clinical supplies business in Asia.

According to Liam FitzGerald, United Drug’s chief executive, the deal marks another important step in the development of the Irish company, as it focuses on “margin-expanding, international opportunities”.

“This business fits well alongside our existing packaging businesses in the US and Europe, and will position us as a leading provider of services in the growing clinical trials materials market. Along with the recent Watermeadow and Pharmexx acquisitions, this transaction extends United Drug’s position and reputation as an international provider of outsourced services to life sciences companies with an unrivalled service offering,” he added.

The Bilcare deal — as alluded to by Mr FitzGerald’s comments — marks United Drug’s third significant acquisition this summer and brings the company’s combined spend, for the period, to around €100m.

“Even post this transaction, the company’s balance sheet remains very strong,” Aiden O’Donnell of Davy Stockbrokers noted yesterday.

United Drug said, last week, that it expects adjusted earnings per share for this year to be up by between 8% and 10%; an announcement which was partially overshadowed by it saying that it is considering de-listing its shares from Dublin’s Iseq index and moving to the London Stock Exchange.

The company’s share price, in Dublin, was up by 2.45% at €2.51, yesterday.


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