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Cape Town - Health and care brands company Ascendis Health [JSE:ASC] announced on Friday that all conditions pertaining to the R7.3bn acquisitions of Cyprus based pharmaceutical manufacturer Remedica and European based sports nutrition company Scitec have been fulfilled.
About half of Ascendis’ sales will now be generated by foreign operations and products will be sold in about 144 countries. Founded in 2008 and listed on the JSE since 2013, it sells a portfolio of brands for animals, plants and humans.
Remedica was acquired for €260m, including a deferred payment of €90m after three years. Scitec was acquired for €170m, including a deferred payment of €20m after one year, with precautions against exchange rate volatility regarding the purchase consideration.
Ascendis completed its first offshore acquisition in August 2015 with the purchase of an initial 49% stake in Spanish pharmaceutical company Farmalider.
Ascendis said in a statement that, together with the Farmalider acquisition, these deals place the company in a strong position to further enhance its range of leading health and care products, broaden its distribution network and continue to develop local and international organic growth synergies.
"The fully underwritten rights offer of 54 million shares was snapped up by the Ascendis shareholders, being three times oversubscribed. The vendor placement was also significantly oversubscribed by local and international investors," Ascendis said.
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In the company's view, this emphasises the growing faith the local and international investment community has in the Ascendis business model and track record.
Ascendis estimates that these acquisitions should drive its market cap close to R11bn.
“We are extremely excited to finally make this announcement. Not only will we gain access to meaningful global platforms, brands and distribution synergies, but we will also inherit a world class staff compliment of industry leading professionals with knowledge and experience that will benefit Ascendis in the long term, and ultimately create value for our clients and shareholders,” said Ascendis CEO Dr Karsten Wellner.
When the two new acquisitions were announced in May this year, Wellner said the company's strategy is to complement organic growth in the domestic health and care market through international expansion and by acquiring platform businesses offshore.
In his view, the acquisitions in the European Union will be game changing for Ascendis and position it as an international health and care business of scale, offering a rand hedge for its SA based business.
By mid-afternoon trade on Friday its share price was down 0.75% at R25.17.
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