Hikma to buy Boehringer Ingelheim's Roxane business for US$2.65bn in cash and stock

Published: 28-Jul-2015

Will boost its presence in US generics market

Hikma Pharmaceuticals is to buy Boehringer Ingelheim's US speciality generics business Roxane for US$2.65bn in cash and stock to boost its presence in the US.

Hikma will pay about $1.18bn in cash and issue 40 million new Hikma shares, or 16.71% of its issued share capital for Boehringer's Roxane Laboratories and Boehringer Ingelheim Roxane on closing the deal.

Hikma has also agreed to make contingent cash payments of up to $125m to Boehringer Ingelheim, subject to the achievement of certain performance milestones.

The company said the deal would transform its position in the US generics market, establishing it as the sixth largest company by revenue. It also adds significant breadth to Hikma’s US portfolio, bringing 88 differentiated products in specialised and niche segments of the market, including oncology, respiratory, extended release and controlled substances.

This transaction has significant strategic value for us, transforming our position and scale in the US generics market

Hikma will also gain a manufacturing facility of 875,000ft2 (around 81,000m2) in Columbus, Ohio, with technologically complex formulation and alternative dosage form capabilities, including modified release solid orals and high potency formulations. In 2014, the plant produced 67 million packaged units.

Hikma's Chief Executive Said Darwazahsaid: '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.'

Professor Andreas Barner, Chairman of the Board of Managing Directors of Boehringer Ingelheim said: 'Boehringer is confident that this transaction can better support the already successful Roxane business to realise its growth potential, domestically and internationally.'

Hikma has developed a relationship with Boehringer in recent years, which was strengthened with its acquisition in 2014 of Boehringer's US generic injectables business Bedford Laboratories.

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