Mylan to buy Swedish drugmaker Meda in $7.2 billion deal
By Natalie Grover
(Reuters) - Generic drugmaker Mylan NV (MYL.O) said it would buy Meda AB (MEDAa.ST) in a $7.2 billion cash-and-stock deal in its third attempt to buy the Swedish company.
The move comes three months after Mylan ditched its seven-month long pursuit of smaller rival Perrigo (PRGO.N).
Shares of Mylan fell 8 pct in after-hours trading after announcing the offer of 165 Swedish crowns per share. That is nearly double Meda's last traded price and some analysts questioned the high premium.
Chief Executive Heather Bresch said on a conference call that the company was looking at doing more M&A deals.
Meda makes branded, over-the-counter and generic drugs. It already handles European sales for EpiPen, Mylan's emergency treatment for severe allergic reactions and its biggest selling branded product.
The Netherlands-based Mylan said the offer, recommended by Meda's board, valued the company at $9.9 billion, including debt.
Meda's two largest shareholders, who own about 30 percent of the specialty pharmaceutical's outstanding shares, have accepted the offer, Mylan added.
In 2014, Meda rejected takeover offers from Mylan after its biggest shareholder spurned the deal. (http://reut.rs/1SJ3eFx)
Stena Sessan Rederi AB, controlled by the Olsson business family, is the biggest shareholder in Meda, with a 20.7 percent stake.
Mylan will finance the cash portion of the offer through a new bridge credit facility arranged by Deutsche Bank Securities Inc and Goldman Sachs Bank USA.
The transaction, due to be completed by the third quarter, is expected by Mylan to immediately add to earnings.
Mylan announced the takeover as it reported fourth-quarter profit and revenue that fell short of analysts' estimates.
Net income attributable to shareholders rose to $194.6 million from $189.2 million a year earlier.
On a per-share basis, profit fell to 38 cents per share from 47 cents per share a year earlier due to an increase in the number of shares outstanding in the latest quarter.
Excluding special items, Mylan earned $1.22 per share, below the average analyst estimate of $1.28 per share.
Revenue rose about 20 percent to about $2.5 billion. Analysts were expecting $2.70 billion, according to Thomson Reuters I/B/E/S.
Mylan shares traded at $46.60 in after-market trading. They closed at $50.54 Wednesday on the Nasdaq, while Meda's shares closed at 86.05 crowns.
Centerview Partners was Mylan’s financial adviser and Cravath, Swaine & Moore LLP, Vinge, and NautaDutilh its legal advisers. Rothschild & Co served as Meda’s financial adviser.
($1 = 8.4069 Swedish crowns)
(Additional reporting by Shailesh Kuber in Bengaluru; Editing by Saumyadeb Chakrabarty and Anil D'Silva)
