Takeda to Buy Nycomed for 9.6 Billion Euros
Takeda to Buy Nycomed for 9.6 Bln Euros to Fill Sales Gap
JB Reed/Bloomberg
Bottles of Takeda Pharmaceutical Co.'s Actos diabetes medication sit on the shelf at a pharmacy in Atlanta, Georgia, U.S.
Bottles of Takeda Pharmaceutical Co.'s Actos diabetes medication sit on the shelf at a pharmacy in Atlanta, Georgia, U.S. Photographer: JB Reed/Bloomberg
Nycomed CEO Hakan Bjorklund
Simon Dawson/Bloomberg
Hakan Bjorklund, chief executive officer of Nycomed.
Hakan Bjorklund, chief executive officer of Nycomed. Photographer: Simon Dawson/Bloomberg
Takeda Pharmaceutical Co. agreed to buy closely held Nycomed for 9.6 billion euros ($13.7 billion), the largest takeover by a Japanese drugmaker, broadening its reach in emerging markets and adding a remedy for smokers’ cough to its portfolio.
Asia’s largest pharmaceutical company will pay cash for Zurich-based Nycomed, which is controlled by Nordic Capital and Credit Suisse Group AG’s private-equity unit, Osaka-based Takeda said in a statement today. The purchase price includes 3.6 billion euros of net debt.
Nycomed, which gets more than a third of revenue from emerging markets, will reduce Takeda’s reliance on sales in Japan and the U.S. The purchase may help the Japanese company buffer a drop in revenue once generic versions of its best- selling diabetes pill Actos are released in 2012.
“Takeda is buying time with this acquisition, it was slow to enter emerging markets,” said Atsushi Seki, an equities analyst at Barclays Plc in Tokyo. “However, it’s an expensive purchase and may not be enough to make up for revenue that will be lost from Actos.”
The announcement was made after markets in Japan closed. Takeda rose 0.5 percent to 3,790 yen at the 3 p.m. close of trading on the Tokyo Stock Exchange. The benchmark Topix index fell 0.7 percent. The shares have shed 5.1 percent this year.
The Japanese drugmaker, which had 874.2 billion yen ($10.8 billion) in cash, deposits and short-term investments as of March 31, will finance part of the transaction through a loan of about 600 billion yen to 700 billion yen, it said.
Revenue Boost
Buying Nycomed will increase Takeda’s annual revenue and per-share earnings by more than 30 percent and bolster operating income, excluding certain items, by more than 40 percent, the Japanese drugmaker said.
“Nycomed enables Takeda to maximize the value of our portfolio and gives us an immediate strong presence in the high- growth emerging markets while doubling Takeda’s European sales,” Yasuchika Hasegawa, the company’s president and chief executive officer, said in the statement.
The deal, slated for completion by the end of September, excludes Nycomed’s U.S. dermatology business, which had revenue of 332.9 million euros last year, according to the company’s annual report.
Takeda is paying about 3.4 times annual sales for Nycomed, compared with an average multiple of 4.1 times in 13 prior pharmaceuticals takeovers of $1 billion or larger announced in the past two years, according to data compiled by Bloomberg.
Emerging Economies
Nycomed earned 774.9 million euros before interest, taxes, depreciation and amortization last year. It sells pantoprazole for heartburn and the smokers’ cough drug roflumilast in Europe as Daxas and as Daliresp in the U.S., where revenue is shared with Forest Laboratories Inc. (FRX)
Emerging economies accounted for 39 percent of Nycomed’s 3.17 billion euros in revenue last year. The Swiss manufacturer aims to increase that proportion to 60 percent by 2015, Chief Executive Officer Hakan Bjorklund said in an interview in March.
Nycomed agreed in February to buy Laboratorios Farmacol SA (FCL) of Colombia and in November said it had bought a majority stake in Chinese biotechnology company Techpool Bio-Pharma Co. Nycomed has about 12,500 employees, four research and development centers in Europe and India, and 15 production facilities and two joint ventures in 13 countries, according to its website.
Takeda Sales
Takeda generated 86 percent of its 1.4 trillion yen of revenue in Japan and North America last fiscal year. The company, which traces its origins to a medicine wholesale business opened in Osaka in 1781, bought Millennium Pharmaceuticals Inc. for $8.9 billion in 2008.
Nordic Capital, based in Stockholm, owns 41 percent of Nycomed, while Credit Suisse’s DLJ Merchant Banking unit holds 26 percent, according to the company’s website. London-based Coller Capital has a 9.7 percent stake and New York-based Avista Capital Partners owns 8.9 percent.
Nycomed was founded in Norway in 1874 by pharmacist Morten Nyegaard as an agent for imported pharmaceutical products. The company has changed hands repeatedly over the past 12 years, moving in the process from Norway to Denmark and then, in 2007, to Switzerland.
Takeda was advised by Deutsche Bank AG. Goldman Sachs Group Inc. and Credit Suisse Group AG advised Nycomed.
To contact the reporter on this story: {Kanoko Matsuyama} in Tokyo at kmatsuyama2@bloomberg.net
To contact the editor responsible for this story: Jason Gale at j.gale@bloomberg.net
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