By Dow Jones Business News,
June 23, 2014, 05:45:00 PM EDT
Abbott Laboratories agreed to acquire Russian drug maker Veropharm for up to $495 million, a deal that give the U.S.
pharmaceutical company a manufacturing presence in that country.
The deal marks the biggest U.S. deal for a Russian firm since the Ukraine crisis spiraled out of control this year.
U.S. deals for three Russian companies have been announced this year, but none has been close to the size of the
proposed Veropharm acquisition, according to Dealogic.
Through the deal, Abbott said it will acquire a portfolio of more than 100 products that are well aligned with its
areas of focus in women's health, central nervous system, cardiovascular, and gastroenterology, while also adding an
offering in oncology.
It will pay between 13.6 billion rubles and 17 billion rubles ($395 million and $495 million) for the controlling
shareholder of Veropharm, called Garden Hills. The holding company has a stake of more than 80% that is expected to rise
to more than 95% by the deal's closing. The final price will be based on Garden Hill's stake in Veropharm when the
acquisition is completed. Abbott also will assume net debt of $136 million.
Abbott expects the acquisition, seen closing in the fourth quarter, to add $150 million to its sales next year, but it
won't affect its per-share earnings outlook for 2014.
-Jonathan Rockoff and Jeanne Whalen contributed to this story.
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