Meda divests manufacturing unit Euromed in Spain
In addition to the Legalon API, Euromed currently supplies high quality products to over 350 customers worldwide accounting for around 70% of its sales.
Meda has entered into a definitive agreement with The Riverside Company for the sale of Euromed SA, a business-to-business manufacturer of herbal extracts and natural active substances located in Spain. The total consideration is EUR 82 million in upfront cash for the shares of Euromed. The unit generates sales of around EUR 40 million and an EBITDA margin of around 20% on an annual basis.
Euromed is a legacy Rottapharm subsidiary, now part of Meda, and has historically been the supplier of the key Legalon API. Meda and Riverside have entered into a favorable long-term strategic supply arrangement with fixed prices for a considerable time. In addition to the Legalon API, Euromed currently supplies high quality products to over 350 customers worldwide accounting for around 70% of its sales.
“The divestment of Euromed is in line with our stated strategy to focus on Meda’s core business of selling and marketing Rx and Cx/OTC products in key markets. The transaction will enhance Meda’s cash flow profile but also positively impact profitability,” said Dr Jörg-Thomas Dierks, Group President and CEO of Meda. “Furthermore we secure a long-term supplier for the API of our key product, Legalon.”
The disposal of Euromed must be reported to the competition authorities in Germany. Competition filings will be initiated within days and the transaction is expected to complete in Q1 2016 following such clearances.
Closing of the transaction is not subject to any other material conditions.
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