MEDIA RELEASE PR36315
Abbott to Acquire Solvay Pharmaceuticals Business
ABBOTT PARK, Ill., Sept. 28 /PRNewswire-AsiaNet/ --
Diversifies Abbott's pharmaceutical products, expanding international
growth platform
Supports long-term strategy to bolster presence in key global
emerging markets
Adds substantial R&D spending capacity to accelerate promising
pipeline programs
Establishes Abbott's presence in the growing global vaccines
market
Provides accretion of approximately $0.10 to ongoing EPS in
2010, accelerating to more than $0.20 by 2012, increasing thereafter
Abbott today announced a definitive agreement with the Solvay Group for
Abbott to acquire Solvay's pharmaceuticals business for EUR 4.5 billion ($6.6
billion) in cash, providing Abbott with a large and complementary portfolio
of pharmaceutical products and a significant presence in key global emerging
markets. The acquisition also includes full global rights to the fenofibrate
franchise. Currently Abbott has U.S. rights to fenofibrate and pays royalties
to Solvay.
Belgium-based Solvay Pharmaceuticals will add more than $3 billion in
annual sales, the majority outside the U.S. Solvay has significant presence
and infrastructure in key high-growth emerging markets, including Eastern
Europe and Asia. Emerging markets are growing faster and increasing in
importance due to demographics, rising incomes and expanded treatment of
chronic disease.
The acquisition will also add approximately $500 million to Abbott's
annual pharmaceutical R&D investment, providing Abbott with the opportunity
to further accelerate near and long-term pharmaceutical growth.
"The acquisition of Solvay Pharmaceuticals further diversifies our
pharmaceutical portfolio, expands our presence in key high-growth emerging
markets, enhances our investment in R&D and accelerates our long-term
earnings-per-share growth outlook," said Miles D. White, chairman and chief
executive officer, Abbott.
"In anticipation of future market needs, we are ensuring we have the
technologies, products, infrastructure and reach to serve patients globally
and continue to deliver sustainable industry-leading growth. This
acquisition, as well as the others we've announced this year all contribute
to achieving that long-term goal," said Mr. White.
"With this transaction Solvay Pharmaceuticals has found a new strong
home, within a respected company with a solid and committed position in the
industry," comments Christian Jourquin, chief executive officer, Solvay.
Solvay's pharmaceutical portfolio complements Abbott's presence and
expertise in specialty markets such as cardiovascular disease, neuroscience
and gastroenterology. Solvay has treatments for Parkinson's disease,
Meniere's disease (abnormality of the inner ear), vertigo, and irritable
bowel syndrome. Solvay also offers products to treat men's and women's
hormonal health, and exocrine pancreatic insufficiency (inability to properly
digest food), which is associated with several underlying conditions
including cystic fibrosis and chronic pancreatitis.
The acquisition also includes Solvay's vaccines business, which will
provide Abbott entry into the expanding global vaccines market. Solvay has a
small molecular diagnostics unit that will become part of Abbott's
diagnostics organization upon the transaction close.
"Abbott's international pharmaceutical business has grown significantly
over the past several years, driven by specialty products in developed
markets," said Olivier Bohuon, executive vice president, Pharmaceutical
Products Group, Abbott. "In emerging markets where chronic disease is being
treated more aggressively, the combined Abbott and Solvay portfolio of
branded generics expands the global reach of these medicines. Solvay's
business will also give us a platform to enter the attractive global vaccines
market."
Financial Highlights
The transaction will be approximately $0.10 accretive to ongoing earnings
per share in 2010, accelerating to more than $0.20 by 2012, increasing
thereafter, all before one-time transaction-related items, which will be
provided at a later date. These one-time transaction-related items are
expected to occur between 2010 and 2012. The transaction also includes
payments of up to EUR 300 million if certain sales milestones are met between
2011 and 2013.
Abbott plans to fund the transaction with cash currently on the balance
sheet.
This transaction is subject to customary closing conditions and
regulatory approvals and is expected to close in the first quarter of 2010.
As a result, the deal will have no impact on 2009 ongoing earnings per share.
The boards of directors of both companies have approved the proposed
acquisition.
Barclays Capital served as an exclusive financial advisor to Abbott on
this transaction.
Abbott Conference Call
Abbott will conduct a special conference call today at 7 a.m. Central
time (8 a.m. Eastern time) to provide an overview of the transaction. The
live Web cast will be accessible through Abbott's Investor Relations Web site
About Solvay Pharmaceuticals
Solvay Pharmaceuticals is a research driven group of companies that
constitutes the global pharmaceutical business of the Solvay Group. These
companies seek to fulfill carefully selected, unmet medical needs in the
therapeutic areas of neuroscience, cardiometabolic, influenza vaccines,
gastroenterology and men's and women's health. Its 2008 sales were EUR 2.7
billion, and it employs more than 9,000 people worldwide. For more
information, visit www.solvaypharmaceuticals.com.
About Abbott
Abbott (NYSE: ABT) is a global, broad-based health care company devoted
to the discovery, development, manufacture and marketing of pharmaceuticals
and medical products, including nutritionals, devices and diagnostics. The
company employs more than 72,000 people and markets its products in more than
130 countries.
Abbott's news releases and other information are available on the
Abbott Forward Looking Statement
Some statements in this news release may be forward-looking statements
for purposes of the Private Securities Litigation Reform Act of 1995. Abbott
cautions that these forward-looking statements are subject to risks and
uncertainties that may cause actual results to differ materially from those
indicated in the forward-looking statements. Economic, competitive,
governmental, technological and other factors that may affect Abbott's
operations are discussed in Item 1A, "Risk Factors," to our Annual Report on
Securities and Exchange Commission Form 10-K for the year ended Dec. 31,
2008, and are incorporated by reference. Abbott undertakes no obligation to
release publicly any revisions to forward-looking statements as a result of
subsequent events or developments.
SOURCE: Abbott
CONTACT: Media, Melissa Brotz
+1-847-935-3456
Scott Stoffel
+1-847-936-9502
Financial, John Thomas
+1-847-938-2655
Larry Peepo
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