Pharmstandard to Spin Off Unit, Buy Singapore’s BeverNaomi Kresge
Pharmstandard, Russia’s biggest pharmaceutical company, plans to spin off its business that makes branded, non-prescription drugs and agreed to buy Bever Pharmaceutical Pte Ltd. for $630 million.
Shares in the over-the-counter drug unit will be distributed proportionally to Pharmstandard stockholders, the Moscow-based company said in a statement today. The company plans a conference call on July 10 to clarify details of the spinoff, Pharmstandard said. The drugmaker announced the purchase of Bever, based in Singapore, in a regulatory filing.
Pharmstandard has been considering selling the over-the-counter unit, which may be valued at about $2.5 billion, people with knowledge of the matter said last month. Today’s announcement makes the prospect of a sale appear more likely, said Natalia Smirnova, a Moscow-based analyst for Deutsche Bank AG.
“It just shows that the company has intentions to sell this business,” Smirnova said in a telephone interview.
Pharmstandard plans a shareholder meeting Aug. 17 to vote on the purchase of Bever, according to the regulatory filing. The Russia company didn’t describe Bever in the filing. Irina Bakhturina, an investor-relations executive for Pharmstandard, didn’t answer her office or mobile phones and didn’t immediately respond to an e-mailed request for comment.
Citigroup Inc. was helping organize the sale process for the over-the-counter unit, the people with knowledge of the matter said last month. The business could provide a gateway to the Russian market, where the government has limited the reach of foreign drugmakers.
Pharmstandard has said it held a 3.4 percent share of Russia’s $24.9 billion pharmaceutical market last year, putting it behind Swiss drugmaker Novartis AG and French pharmaceutical company Sanofi.
Over-the-counter drug sales fell 4.5 percent to 14.8 billion rubles ($445 million), accounting for 29 percent of Pharmstandard’s revenue. Sales growth came instead from the prescription-drug unit, with revenue rising 33 percent. Revenue from third-party over-the-counter products also rose 30 percent to 28.3 billion rubles.
Pharmstandard’s global depositary receipts fell 1.2 percent to close at $20.10 in London. Pharmstandard is also listed on the Micex exchange in Moscow.