Perrigo in Expansion Mode - Analyst Blog

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Perrigo Company ( PRGO ) recently announced that it is set to acquire a UK-based privately held pharmaceutical company, Rosemont Pharmaceuticals Ltd. and has entered into a definitive merger agreement for the same. The deal is valued at $283 million.

By acquiring Rosemont Pharma, Perrigo aims to strengthen its position in the UK oral liquid formulations space. Rosemont Pharma boasts of a portfolio of more than 90 products. The company generated net sales of more than $60 million in 2012.

The deal is expected to boost Perrigo's adjusted earnings in fiscal 2013 by $0.08 per share. Perrigo now expects fiscal 2013 earnings in the range of $5.53 - $5.73 per share (previous guidance: $5.45 - $5.65 per share). The Zacks Consensus Estimate of $5.56 per share is towards the lower end of the company's guidance range.

We note that Perrigo has been quite active on the acquisition front lately. In a bid to strengthen its position in the over-the-counter (OTC) retail pet healthcare market, just a few days back Perrigo inked a deal to buy animal health company Velcera, Inc. for $160 million in cash. The deal is expected to close in calendar year 2013.

In Dec 2012, Perrigo acquired privately-held Cobrek Pharmaceuticals, Inc. for approximately $45 million in cash. In Oct 2012, Perrigo had 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 #3 (Hold). Other players in the generic market, such as Mylan Inc. ( MYL ) and P ernix Therapeutic Holdings, Inc. ( PTX ), carry a Zacks Rank #2 (Buy). Meanwhile, biopharma stock, Valeant Pharmaceuticals ( VRX ) has a Zacks Rank #1 (Strong Buy).



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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: MYL , PRGO , PTX , VRX

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