German drugmaker Stada has finalised its acquisition of UK over-the-counter drugmaker Thornton & Ross in a deal valued at £221 million.
Stada first unveiled a bid for privately-held T&R – claimed to be the UK’s largest independent OTC pharmaceutical manufacturer and the number five company overall – in August.
The move should not come as a surprise given Stada – which has been billed as a takeover target for years – has been saying for some time it was interested in an international, branded products acquisition to help reduce its reliance on the German market.
Stada chief executive Hartmut Retzlaff said last year that the company should make some bolt-on acquisitions to help it avoid a takeover bid that might undervalue the company, which has been linked in the past to interest from Actavis, Sun Pharma and Teva, amongst others.
That said, Stada has been growing pretty well on its own. Sales for the first six months of 2013 came in at €885 million, up 10% year-on-year, with operating profit rising 30% to €132 million.
T&R recorded sales of £66 million in the 12 months to March 31, an 11% rise on the previous financial year, from its portfolio of branded OTC products, with the bulk of its sales coming from pharmacy and drugstore distribution channels in the UK.
T&R has grown by acquisition itself, for example by buying the Allens brand of cough and cold products in 2010, and has also been expanding organically with the launch of a new line of dermatological products in 2011 along with a push into international markets.
The UK firm has an Good Manufacturing Practice (GMP) certified production site in Huddersfield and currently employs approximately 425 people.
Stada said the UK firm would be incorporated into the group by September 1 and would make an immediate contribution to profit as T&R’s operating profit is currently running at above the average of the Stada group. The German drugmaker funded the acquisition with cash on hand and existing credit lines.
