Icelandic drugmaker Actavis has thrown its hat into the ring as the bidding warms up to win control of Merck KGaA’s generics unit, which the latter is selling to help finance its acquisition of Switzerland’s Serono.
The company’s chief executive, Robert Wessman, told the Financial Times that "we are preparing ourselves to bid. We are ready with funding for due diligence," making Actavis the second firm, after India’s Ranbaxy, to express an interest in Merck’s generics arm.
The purchase price being touted by analysts at the moment is 4-5 billion euros and Mr Wessman said he had selected three international banks to help finance a bid from a short list of ten. He declined to say how much Actavis is going to offer but told the FT that “we are well covered within the range of bids we assume will be reasonable."
Mr Wessman added that the firm was not looking for any partners to help finance a deal, unlike Ranbaxy, which is believed to be considering a bid in combination with private equity groups.
Actavis has been treading the acquisition trail with some force since it lost out to the USA’s Barr Laboratories at the end of last year in an attempt to buy Pliva of Croatia. Since then, it has acquired US specialty generics firm Abrika Pharmaceuticals in a deal that is potentially worth $235 million, bought a majority stake in Russian manufacturing company ZiO Zdorovye, purchased a production plant in India and also made a bid for a majority stake in Romania’s Antibiotice.
Halldor Kristmannsson, Actavis’ vice president of corporate communications told AFX News that Merck's generics unit “would be a great strategic fit” but added that “our policy is not to overpay for companies we acquire. We are serious about Germany. We are open to acquisitions there because to be competitive in a market you need critical mass.”
Mr Kristmannsson said that the company had bolstered its sales force in Germany to 160 from 80 in the past three months, and it has plans to launch 20 new products there.