Aspen Pharma’s A$900-million lifeline resucitates Sigma
16 Aug 2010
Terminally sick Sigma Pharmaceuticals, the Australian loss-making OTC drugs and prescription drug company, today received a lifeline after South Africa's Aspen Pharmacare Holdings agreed to buy its drugs unit for A$900 million ($799 million).
The deal comes after the Durban-based Aspen conducted due diligence for three-months since it made its original takeover offer of A$707-million ($579 million) in late May 2010. (See: Sigma Pharmaceuticals reveals mystery bidder is South Africa's Aspen Pharmacare)
On 21 May 2010, Aspen, South Africa's largest drug company had offered to buy Sigma for $A60 cents a share or A$707 million ($579 million). It also offered to take on Sigma's debt of A$785 million.
After conducting due diligence, Aspen lowered its takeover offer on 7 July by 8.3 per cent to a conditional A$648 million, raising doubts whether Aspen was serious about acquiring the loss-making Sigma. (See: Aspen lowers takeover offer for Sigma by 8.3 per cent)
After conducting a review of Sigma's financial accounts, Aspen decided to buy Sigma's generic and manufacturing business instead of a full takeover.
Under the deal, Aspen has agreed to buy Sigma's generic and over-the-counter drugs unit that comprises of Sigma's generics, consumer, OTC, Herron, ethical products, medical products, orphan and manufacturing businesses.
