* Buys Amdipharm Mercury, gains access to 190 drugs
* Enters overseas markets with deal
* Toronto-listed shares down nearly 10 pct
(Adds details from conference call)
By Amrutha Penumudi
Sept 8 (Reuters) - Canada's Concordia Healthcare Corp
CXRX.O CXR.TO said it would buy Amdipharm Mercury Ltd from
private equity firm Cinven for $1.9 billion, boosting its
portfolio of drugs to 200 from 20 and giving it a foothold in
overseas markets.
Amdipharm Mercury, created with the merger of Mercury Pharma
and Amdipharm in 2012, buys off-patent drugs from big pharma
companies such as Novartis AG NOVN.VX , GlaxoSmithKline Plc
GSK.L and Abbott Laboratories (NYSE:ABT) ABT.N and sells them in about
100 countries.
Amdipharm's 190 drugs are used in several difficult-to-treat
conditions including hyperthyroidism, depression and bacterial
infections. ID:nCNWmJLp4a
Concordia's shares fell nearly 10 percent on the Toronto
Stock Exchange after the deal, the biggest in the company's
history. The stock has more than doubled in value this year.
Amdipharm is Concordia's second acquisition this year as the
Canadian company tries to gain scale through acquisitions, much
like its larger rival Valeant Pharmaceuticals International Inc (NYSE:VRX)
VRX.TO .
Concordia CEO Mark L Thompson called the acquisition a
"powerful cash-machine" that would help the company with future
deals.
The deal is expected to boost Concordia's sales to about
$870-$920 million in 2015 on a pro-forma basis, of which about
$530-$560 million is expected to come from Amdipharm.
"Previously Concordia was looking to acquire U.S. assets.
Now they can look to acquire on a global basis ... that's the
main thing they are gaining here," Laurentian Bank Securities
analyst Joseph Walewicz said.
The company spent $1.2 billion in cash earlier this year to
buy some assets of privately held Covis Pharma Holdings SARL.
Including debt, the Amdipharm deal is valued at $3.3
billion. The transaction also includes performance-based
payments of up to $220 million, payable in cash in the fourth
quarter of 2016.
Cinven is expected to hold a 19.9 percent stake in Concordia
after the transaction closes, the Canadian drugmaker said.
The deal, which is expected to close in the fourth quarter
of 2015, will immediately add to Concordia's adjusted earnings.
Goldman, Sachs & Co is the financial adviser to Concordia
and Sullivan & Cromwell LLP, Fasken Martineau DuMoulin LLP and
Simmons & Simmons LLP are its legal advisers.
Jefferies and Rothschild are Cinven's financial advisers and
Clifford Chance, Torys LLP and Jones Day its legal advisers.
Concordia's U.S.-listed shares were down about 10 percent at
$76.