Abbott to sell generics pharmaceuticals business to Mylan, form new entity
Abbott will sell its non-U.S. developed markets branded generics pharmaceuticals business to Mylan for 105 million shares, or approximately 21%, on a fully diluted basis, of a newly formed entity that will combine Mylan's existing business and Abbott's developed markets pharmaceuticals business. The new entity will be a publicly traded company. This represents a value of approximately $5.3 billion based on Mylan's closing stock price on Friday.
The business to be sold operates in Europe, Japan, Canada, Australia and New Zealand and includes approximately 3,800 employees. It includes a broad portfolio of medicines, as well as manufacturing facilities in France and Japan. Abbott will retain its product portfolio and manufacturing facilities in other geographies, as well as its manufacturing facilities in the Netherlands, Germany and Canada.
Abbott does not expect to be a long-term shareholder in Mylan and plans ultimately to redeploy the net proceeds from this transaction to opportunities that would be accretive to earnings over time.
Abbott will retain its branded generics pharmaceuticals business and products in emerging markets, plus its other businesses and products in developed markets. Abbott's branded generics pharmaceuticals business will focus in emerging geographies where demographics and growing healthcare systems are combining to create an increased rate of patient access to healthcare and where the majority of healthcare products are paid for by the consumer.
The transaction is expected to close in the first quarter of 2015.