C.R. Bard, a Murray Hill, N.J.-based multinational developer, manufacturer and marketer of medical technologies, has entered into a definitive agreement to acquire Kobayashi Pharmaceutical’s 50% ownership share in Medicon—the Osaka, Japan-based venture that the two companies have operated together since 1972—through a share redemption. The transaction is expected to close in early November, after which Medicon will be a wholly owned subsidiary of the company. The transaction has been approved by each company’s board of directors and is subject to customary closing conditions.
For more than 40 years, Bard and Kobayashi have jointly operated Medicon by leveraging the local expertise of Kobayashi and the product leadership of Bard. In recent years, Medicon has built clinical and regulatory capabilities that have allowed the business to more effectively introduce new products. At the same time, Bard has demonstrated the ability to execute its product leadership strategy with a direct selling model in international markets. Today, the company believes future growth opportunities in Japan will come from market segments that are more clinically differentiated, including peripheral vascular and vascular access. Therefore, the company believes now is the time to take a more direct role with clinicians and patients in Japan.
The company expects the transaction to add about $40 million to 2016 net sales. On an operational basis (excluding the impact of foreign exchange), the company expects the transaction to be neutral to adjusted cash earnings per share both in the fourth quarter of 2015 and all of 2016, and to be accretive thereafter.
Kobayashi will receive 3 billion yen ($25 million) at closing.