Gedeon to acquire Russian, Polish drug producers

Source: ExecUK

Date :15/11/2007 11:28:14

Gedeon Richter Plc announced today that it has entered into an agreement to acquire 80.6 percent of Russian drug producer OAO Akrihin also the completion of the combination with Poland’s Polpharma.

The transaction values Akrihin at HUF 22 billion forints ($128 million) and is not subject to Gedeon Richter shareholder approval. Richter has also bought Poland’s biggest drug producer Polpharma for 231 billion forints.

Gedeon will acquire both firms from Genefar BV and pay with Richter shares.

European markets

In completing both transactions Richter will have the second biggest market share in both Russia and Poland. Akrihin, already a strong established brand in Russia, had sales of around $63 million in 2006.

"Very clearly Poland is the biggest and strongest market in Central Europe and this will put us in a position to take advantage of its strength," Richter Chief Executive Erik Bogsch told a news conference.

Richter said it expected annual synergies of around $35 million from the deal which requires the approval of Richter shareholders at an extraordinary meeting on December 18.

The deal will also require the approval of the Hungarian government, which owns 25 percent of Richter.

Completing transaction

Following completion, Genefar would then own 26.75 percent of the enlarged Gedeon Richter, including the shares to be issued for the Polpharma shares.

The transaction is expected to be completed in the first quarter of 2008.

Earlier on Thursday Richter said its third-quarter net profit fell 27 percent, as sales in Hungary fell 24 percent.

November 15, 2007