Dechra Pharmaceuticals’s $5.6 billion takeover deal struck

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Dechra Pharmaceuticals’s $5.6 billion takeover deal struck

In the middle of takeover talks, EQT AB agreed to buy the drug company, Dechra Pharmaceuticals plc, for about 4,46 billion $5.6 billion.

Investors will get $3,875 pence for every Dechra share, EQT said Friday. It was 4.8% lower than the bid price of 4,070 pence the companies were originally discussing. Bloomberg reported Thursday that the Swedish buyout firm and the UK company were likely to announce a deal Friday, and EQT was seeking a lower price.

Shares of Dechra rose 1% in London on Thursday, with a market value of 3.8 billion.

In mid-April, Dechra said it was in talks with EQT about a possible all-cash bid of 4,070 pence a share, or about 4.6 billion. The two sides had been discussing a possible price reduction, as Dechra warns on May 22 that underlying operating profit would be below a previous forecast due to a more volatile and challenging environment.

On 11 May, Dechra extended the deadline for EQT to announce a firm offer in accordance with UK takeover rules. The Abu Dhabi Investment Authority's private equity arm, the Abu Dhabi Investment Authority, is set to be a co-investor in the deal, EQT has said.

The acquisition is a result of the slowdown in private equity dealmaking, amidst a dearth of cheap financing for such transactions. Dechra is a worldwide veterinary supply company that is famous for making drugs for pets like dogs, cats, and rabbits. It also produces products for animals, such as horses, cattle and pigs.

EQT is an acquisitive company that has been active in the veterinary sector. It is the biggest shareholder of IVC Evidensia, one of the biggest veterinary services providers in Europe. The company has also invested in online retailers such as ZooPlus and pet insurer ManyPets.

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