Abbott to Acquire Veropharm
ABBOTT PARK, Ill., June 23, 2014
ABBOTT PARK, Ill., June 23, 2014 /PRNewswire/ --Abbott (NYSE: ABT)today
announced a definitive agreement to acquire Veropharm, a leading Russian
pharmaceutical manufacturer. Under the terms of the agreement, Abbott will
acquire Limited Liability Company Garden Hills, the holding company that
currently owns a controlling interest in Veropharm, for between 13.6 billion
rubles and 17 billion rubles (or a range of approximately $395 million to $495
million U.S. dollars) depending on Garden Hills' share ownership of Veropharm
at time of close. Garden Hills currently owns more than 80 percent of
Veropharm but is expected to own more than 95 percent by the time the
transaction closes. Pursuant to the agreement, Abbott will also assume net
debt of 4.7 billion rubles (or approximately $136 million U.S. dollars).
Abbott has had a presence in Russia for nearly 40 years and, in line with the
company's long-term commitment to growing global health care markets and
capabilities, is committed to providing a reliable supply of its health care
products to Russian patients.
Through this acquisition Abbott will obtain a portfolio of medicines that is
well aligned with its current pharmaceutical therapeutic areas of focus in
women's health, central nervous system, cardiovascular, and gastroenterology,
while also adding an offering in the field of oncology.
Upon completion of the transaction, Abbott would also establish a
manufacturing presence in Russia through its ownership of Veropharm's existing
production facilities as well as a new state-of-the-art manufacturing facility
that is currently under construction by Veropharm. Abbott intends to utilize
its manufacturing expertise to expand Veropharm's capabilities and enhance the
Under terms of the agreement, the purchase price Abbott pays for Garden Hills
is determined based on the percentage of Veropharm shares owned by Garden
Hills at the time Abbott purchases Garden Hills. If Garden Hills owns 100
percent of the shares of Veropharm at that time, the total purchase price
would be 17 billion rubles (or approximately $495 million U.S. dollars).
Abbott will also assume net debt of 4.7 billion rubles (or approximately $136
million U.S. dollars).
Abbott plans to fund the transaction with cash on the balance sheet.
Abbott expects the acquisition to add approximately $150 million U.S. dollars
in sales in 2015. The transaction is expected to close in the fourth quarter
and will not impact Abbott's ongoing earnings-per-share guidance for 2014. The
transaction is subject to customary closing conditions and regulatory
Veropharm is one of the largest Russian pharmaceutical manufacturers. The
company's production facilities comprise three pharmaceutical manufacturing
sites in Pokrov, Belgorod and Voronezh. The company's product portfolio
includes over 100 pharmaceutical products. Veropharm employs more than 2,000
Abbott is a global healthcare company devoted to improving life through the
development of products and technologies that span the breadth of healthcare.
With a portfolio of leading, science-based offerings in diagnostics, medical
devices, nutritionals and branded generic pharmaceuticals, Abbott serves
people in more than 150 countries and employs approximately 69,000 people.
Abbott has been operating in Russia since 1978 with its Russian operations
headquartered in Moscow.
Abbott's news releases and other information are available on the company's
websites www.abbott-russia.ru and www.abbott.com. Connect with us on Twitter
Private Securities Litigation Reform Act of 1995 – A Caution Concerning
Some statements in this news release may be forward-looking statements for
purposes of the Private Securities Litigation Reform Act of 1995. Abbott
cautions that these forward-looking statements are subject to risks and
uncertainties that may cause actual results to differ materially from those
indicated in the forward-looking statements. Economic, competitive,
governmental, technological and other factors that may affect Abbott's
operations are discussed in Item1A, "Risk Factors," to our Annual Report on
Securities and Exchange Commission Form10-K for the year ended Dec. 31, 2013,
and are incorporated by reference. Abbott undertakes no obligation to release
publicly any revisions to forward-looking statements as a result of subsequent
events or developments, except as required by law.
Contact: Media: U.S., Scott Stoffel, (847) 936-9502; or Russia, Irina
Gushchina, +7 909 167 96 12; or Financial: Brian Yoor, (847) 937-6343, Scott
Leinenweber, (847) 935-1898
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