Tuesday, 23 September 2014

Hikma Pharmaceuticals eyes $1 billion purchase of CorePharma

I realise most of the dealmaking community is currently focused on the risk that some large pharmaceutical deals may collapse. But I have stumbled across a potential pharmaceutical deal that is unlikely to be affected by the US government's attempt to clamp down on corporate "tax inversions".

I have been told by reliable sources that FTSE 250-listed Hikma Pharmaceuticals, which manufactures branded and non-branded generic pharmaceutical products, has been looking at buying US-based CorePharma for up to $1 billion.

CorePharma has been put up for sale by RoundTable Healthcare Partners after nine years of ownership, according to reports. Roundtable is said to have Credit Suisse to sell CorePharma, which makes pharmaceutical products that are difficult to develop. Here is a link to report on the potential sale of CorePharma: http://www.nasdaq.com/article/roundtable-plans-to-sell-corepharma-for-at-least-1-billion-20140801-00608

Anyway, I have been told that Hikma has been bidding in the early stages of the auction and may be getting quite serious about purchasing CorePharma. Barclays and HSBC have been lined up to provide debt financing for the deal, according to my reliable sources.

Whilst I believe Hikma is keen on CorePharma, it is quite possible the FTSE 250 company might fail to pull of the deal as there are thought to be rival bidders, who could be willing to offer more for the US business.

Hikma has been quite acquisitive in the recent months. In the summer, the company bought assets from Ben Venue Laboratories. Here is a link to the statement confirming that deal: http://www.investegate.co.uk/hikma-pharmaceutical--hik-/rns/acquisition/201409170700298888R/

I asked a Hikma spokesperson for a comment this morning but so far the company has not responded.

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