Wockhardt acquires Negma Laboratories in France

Wockhardt Ltd on May 03, 2007 has announced the acquisition of Negma Laboratories, the fourth largest independent, integrated pharmaceutical group in France with sales of $ 150 million. The Company has acquired Negma Laboratories in an all-cash deal worth $ 265 million. The transaction is valued at 1.8 times the sales and 9.7 times the EBITDA.

With this acquisition, the Company becomes the largest Indian pharmaceutical Company in Europe with more than 1500 employees based in the continent.

"France-based Negma is a unique acquisition for Wockhardt. It is a research based pharmaceutical Company with 172 patents. The acquisition will allow Wockhardt to extend this patented portfolio to other European markets where Wockhardt enjoys a strong presence," said the Company's Chairman Habil Khorakiwala. "Further, it will provide us the right entry vehicle to enter the French generics market valued at $ 2 billion, leveraging Wockhardt's robust EU portfolio and impressive pipeline. With this acquisition, Wockhardt will enjoy a pan-European presence, covering all the key markets of Europe - namely Germany, UK, Ireland and now France".

Negma has a strong research and life cycle management capability. It owns a rich portfolio of 172 patents and has an exciting range of products in various stages of development. The Company holds leading positions in the osteoarthritis / rheumatology, phlebotonic and the arterial hypertension segments.

With the Negma acquisition, the Company's European business will now account for more than 60% of the Company's total revenues. The Company presently has a portfolio of 130 products in the European market. In the next one year, the Company will see the launch of 24 snore products in Europe.

"We have a proven track record of successful value-creation post acquisitions. We expect to demonstrate the same integration momentum with Negma as with our other acquisitions," said Khorakiwala

Cleary Gottlieb Steen & Hamilton LLP was the legal advisor for the Company in this transaction. Aforge Finance and Dechert were advisors to Negma.

Negma is the Company's third acquisition in less than 12 months. Earlier the Company acquired Pinewood (Sales $ 70 million) and Dumex (Sales Rs 60 crores).

Negma is the Company's fifth acquisition in Europe after Wallis, CP Pharmaceuticals (both in UK), Esparma in Germany and Pinewood Laboratories in Ireland. With the Negma acquisition, the Company will now have four manufacturing facilities in Europe having API (bulk drug), injectables, tablets, capsules and creams.

Source : Equity Bulls

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