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Week ending June 12, 2015:
Recent Healthcare M&A Deals
Pharmaceuticals
Acquirer
Target
Price
Mission Pharmacal Company
ProSolus Pharmaceuticals LP
N/A
POZEN Inc.
Tribute Pharmaceuticals Canada Inc.
$146 million
Aytu BioScience, Inc.
Rights to ProstaScint®
N/A
Rehabilitation
ATI Physical Therapy
Proaxis Physical Therapy
N/A
HealthSouth Corporation
Reliant Hospital Partners, LLC
$730 million
Bayer’s Diabetes Care Business Fetches $1.1 Billion
Last week Bayer AG (XETRA: BAYN) agreed to sell its Diabetes Care business to Panasonic Healthcare Holdings Co., Ltd. for €1,022 million (¥138 billion), or $1.154 billion. The sale includes the leading Contour™ portfolio of blood glucose monitoring meters and strips, as well as other products such as Breeze™2, Elite™ and Microlet™ lancing devices. The portfolio accounted for €909 million (of $1.02 billion) in sales in 2014, according to Bayer. Panasonic Healthcare Holdings was formed in September 2013 when KKR & Co. (NYSE: KKR) invested $1.67 billion in cash to gain 80% control of the healthcare division of Japan’s Panasonic Corporation. Panasonic retained 20% of the division. With this acquisition, Panasonic strengthens its In Vitro Diagnostics including self-monitoring of blood glucose systems.
The Rehab Sector Shows Some Muscle
HealthSouth Corporation’s (NYSE: HLS) acquisition of Reliant Hospital Partners LLC for $730 million was a tremendous boost for the sector’s year-to-date spending, bringing the total to $85 million through June 12, 2015. But the real action, as always, is in the deal volume. In the same period, 12 acquisitions of rehabilitation facilities and occupational therapy clinics have been announced. Compare that to the same period in 2014, and only seven deals were reported, with just $11 million spent. Here are the three deals in 2015 with reported prices.
Top Three Rehabilitation Deals in 2015, through June 12
Acquirer
Target
Price
HealthSouth Corporation
Reliant Hospital Partners, LLC
$730 million
U.S. Physical Therapy
9-clinic physical therapy practice
$7.2 million
U.S. Physical Therapy
3 physical therapy practices
$4.8 million
Source: The Health Care M&A Information Source, June 12, 2015
Nautic Partners Exits, HealthSouth Buys In
Nautic Partners made a grand exit last week as it sold Reliant Hospital Partners, LLC to HealthSouth Corporation (NYSE: HLS) for $730 million. Reliant operates a portfolio of 11 inpatient rehabilitation hospitals in Texas, Massachusetts and Ohio, plus three inpatient satellite locations in Massachusetts, for a total of 902 beds. All of the hospitals are leased. Operating entities at seven of the hospitals include minority limited partners whose interest represents less than 10% of the equity of the combined Reliant operating entities. HealthSouth will assume the lease obligations of all the acquired hospitals. Based on the structure of the transaction, it expects to realize a tax benefit with and estimate net present value of approximately $125 million to $150 million.
The Old Irish Shuffle Play
A bit of financial wheeling and dealing occurred last week, as Altan Pharma Limited, a privately held pharmaceutical company based in Dublin, Ireland, announced its acquisition of Madrid-based GES Group, which is comprised of GES Genéricos Españoles Laboratorio; Genfarma Laboratorio, S.L. and Biomendi, S.A.U. The price was €87.5 million ($98.3 million, approximately). What the announcement left out was that, on the same day, Dublin-based Malin plc invested €34.5 million ($38.9 million, approximately) to gain a 65% equity stake in Altan Pharma. While Altan is a central player to these transactions, it lacks a website, as well as a corporate address. But now it owns GES Group, which develops, manufactures and markets specialty injectable drugs with an international distribution business. Time to get cracking on a corporate image…………………………Click here for a free trial to The Health Care M&A Information Source and download the current issue today.
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