Adcock Ingram agrees takeover terms with CFR

Adcock Ingram (AIP: SP), one of South Africa’s largest drugmakers, has provided further details of the previously-announced proposed acquisition by Chile-based CFR Pharmaceuticals (The Pharma Letter July 4), saying that the boards of both companies have reached agreement regarding the proposed terms and conditions of the potential offer, worth around 12.6 billion rand ($1.26 billion) is to be settled partly in cash and partly in new CFR shares.

The proposed combination of Adcock Ingram and CFR, Chile’s largest drugmaker, will create a uniquely diversified emerging markets pharmaceuticals company with listings in Santiago and Johannesburg, targeting a market of over two billion patients across Latin America, Africa, South East Asia and India. The combination of CFR and Adcock Ingram is anticipated to generate significant revenue and cost synergies, with an estimated net present value at least $440 million (4.4 billion rand).

Adcock Ingram will be an integral part of the combined business, generating up to 40% of group revenue. CFR is committed to growing Adcock Ingram’s business in South Africa and Africa, transferring manufacturing capacity to South Africa, preserving and growing jobs and maintaining Adcock Ingram’s commitment to broad-based black economic empowerment.