Fresenius to acquire APP Pharmaceuticals

A leading US-based provider of hospital-based injectable pharmaceutical products has entered into a definitive merger agreement to acquire global healthcare group Fresenius.

A leading US-based provider of hospital-based injectable pharmaceutical products has entered into a definitive merger agreement to acquire global healthcare group Fresenius.

Under the terms of the agreement, Fresenius will acquire the outstanding common stock of APP, based in Illinois, for $23 in cash per share plus a contingent value right that could deliver up to an additional $970m, or $6 per share in cash, if the financial results of the Company meet certain targets payable in Q2 2011.

The company is involved in the sales in products and services for hospital, dialysis and in home medical care.

Fresenius will also assume all of APP's outstanding debt, which currently totals approximately $940m, net of cash. In aggregate, the consideration for the acquisition of APP, including the CVR, could be up to $5.6bn.

Patrick Soon-Shiong M.D., founder and chairman of APP, said: "The combined company will allow for the rapid globalisation of APP's portfolio with the same high levels of quality and patient commitment for which we have become known, while at the same time providing a more comprehensive and complementary offering of injectable pharmaceuticals, devices and delivery systems to customers worldwide."

APP will join Fresenius as part of its Fresenius Kabi division. Through the acquisition of APP, Fresenius Kabi enters the US pharmaceutical market and achieves a leading position in the US injectable generics market. The worldwide presence of Fresenius combined with APP's extensive market penetration in the US will create substantial global opportunities for growth for both companies.

Dr Ulf Mark Schneider, chairman of the management board of Fresenius SE, said: "APP is a fast-growing, highly profitable company with a strong management team that has an excellent market position in the U.S. Our firm very much shares APP's dedication to quality and medical excellence for the benefit of patients. The acquisition provides significant growth opportunities for Fresenius Kabi.

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