The spate of acquisitions at
) continued with its purchase of companion animal health company,
Velcera, Inc. for approximately $160 million in cash.
The deal, which has strengthened Perrigo's position in the
over-the-counter (OTC) retail pet healthcare market, looks good
to us. The acquisition adds the erstwhile Velcera's PetArmor
franchise of Flea and Tick therapies to Perrigo's product
portfolio. Perrigo stated in its press release that the retail
sales of the franchise were more than $100 million during
calendar year 2012. The franchise was launched in Apr 2011.
Perrigo expects the acquisition to boost its adjusted earnings
slightly in fiscal 2013. Perrigo expects adjusted earnings for
fiscal 2013 in the range of $5.53 - $5.73 per share. The
company's fiscal year ends on the last Saturday of June every
year. The transaction is expected to boost Perrigo's adjusted
earnings in fiscal 2014 by 11 cents per share. The deal is
expected to be accretive to ROIC in fiscal 2015.
We note that Perrigo has been quite active on the acquisition
front lately. In Dec 2012, Perrigo acquired privately-held Cobrek
Pharmaceuticals, Inc. for approximately $45 million in cash. In
Oct 2012, Perrigo acquired the entire assets of privately-held
Sergeant's Pet Care Products, Inc.
Perrigo, which develops, manufactures and distributes OTC and
generic prescription pharmaceuticals among others, carries a
Zacks Rank #2 (Buy). Another player in the generic market
) also carries a Zacks Rank #2. Meanwhile, pharma stocks such as
Osiris Therapeutics, Inc.
) carry a Zacks Rank #1 (Strong Buy).
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