Perrigo is becoming a pure-play consumer self-care company with the sale of its generic pharmaceuticals business unit. The Dublin-based company and Altaris Capital Partners have reach an agreement for Altaris to acquire the generics unit for $1.55 billion, including $1.5 billion in cash, subject to customary adjustments.
As part of the consideration, Altaris will also assume more than $50 million in potential research and development milestone payments and contingent purchase obligations with third-party Rx partners.
"The sale of our generic Rx business is the most impactful step in Perrigo's transformation plan," said Perrigo CEO and president Murray Kessler. "Perrigo Consumer Self-Care will have a focused portfolio with over $4 billion in revenues focused on the growing trends towards self-managed health and wellness. This transaction also provides the company with increased financial predictability and flexibility. After the transaction closes, Perrigo expects to have more than $2 billion in cash available to advance its consumer self-care strategy, preferably through prudent and revenue accretive M&A. This is an exciting day for Perrigo."
Perrigo's generics portfolio includes topical generic medicines in multiple dosage forms, including creams, foams, mousses, gels, liquids and inhalable products.
"Given our experience in the pharmaceutical sector and track record of corporate carve-out transactions, we believe we are well-positioned to support the Rx business as it becomes a standalone company focused on its mission of developing and marketing affordable pharmaceutical products," said Garikai Nyaruwata, Altaris managing director.
The transaction is subject to customary closing conditions and is expected to close by the end of the third quarter. Centerview is serving as financial advisor and Wachtell, Lipton, Rosen & Katz is serving as legal counsel to Perrigo on the transaction. J.P. Morgan is serving as lead financial advisor and Lead Left Arranger and Goldman Sachs & Co. is serving as financial advisor and Arranger to Altaris Capital. Schiff Hardin and Cleary Gottlieb are providing legal counsel to Altaris.