CFR Agrees to $1.3 Billion Purchase of S. Africa’s Adcock Ingram

CFR Pharmaceuticals SA (CFR), Chile’s largest drugmaker, agreed to pay 12.6 billion rand ($1.3 billion) in cash and shares for Adcock Ingram Holdings Ltd. (AIP) as it seeks to expand in emerging markets.

CFR will settle 51 percent to 64.3 percent of the purchase through cash and the balance through new CFR shares, the companies said in a joint statement today. The transaction equates to 73.51 rand an Adcock share, they said.

The deal “will create a uniquely diversified emerging markets pharmaceuticals company with listings in Santiago and Johannesburg, targeting a market of over two billion patients across Latin America, Africa, South East Asia and India,” the companies said in the statement.

CFR fended off competition from London-based private equity firm Actis LLP and Bidvest Group Ltd. (BVT), a Johannesburg-based food and car sales company, in agreeing to buy Adcock, the maker of drugs including Panado painkillers. CFR, which listed stock in Santiago in 2011, bought Laboratorio Franco Colombiano Lafrancol SAS in December for $560 million, giving it the biggest share of the Colombian market.

The transaction will allow CFR to make cost savings worth at least $440 million, according to the statement. Adcock Ingram will generate as much as 40 percent of the group’s combined revenue. Adcock will be delisted from the Johannesburg exchange and CFR plans a secondary listing on the bourse, they said.

CFR will transfer “manufacturing capacity to South Africa, preserving and growing jobs and maintaining Adcock Ingram’s commitment to broad-based black economic empowerment,” it said, referring to South African laws that require companies to sell at stakes in their local operations to black citizens, with transactions that benefit workers,

To contact the reporter on this story: Kevin Crowley in Johannesburg at

To contact the editor responsible for this story: John Viljoen at

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