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Sweden’s Recipharm Agrees To Buy Britain’s Consort Medical For 505 Million Pounds

Swedish pharmaceutical group Recipharm (RECIb.ST) has agreed to buy British peer Consort Medical (CSRT.L) for 505 million pounds or 6.3 billion crowns ($649 million), the companies said on Monday.

They said the owners of Consort Medical, which makes drug delivery devices including nasal inhalers and pharmaceutical compounds, would receive 10.10 pounds per share, valuing the share capital at 505 million pounds on a fully diluted basis.

They said in separate statements that the board of Consort Medical had unanimously recommended the cash offer, news of which sent Consort Medical’s shares up 43% to 10.40 pounds at 0841 GMT.

They said the offer represented a premium of 39.1% to Consort Medical’s closing price on Friday of 726 pence.

Recipharm, which develops and manufactures products for other companies in the industry on a contractual basis, said the deal would boost its scale and profitability, giving it annual pro forma sales of 10.8 billion crowns and pro forma operating profit before depreciation and amortisation of 1.79 billion.

“The combination of Recipharm and Consort is highly complementary given that both organisations provide different products and services within the same value chain for a number of customers,” Recipharm said.

Its shares were down 0.5% at 0842 GMT, underperforming the wider market in Stockholm .OMXSPI which was roughly unchanged.

Recipharm said it intended to carry out one or several share issues totalling around 2.5 billion crowns to repay loans taken to fund the deal and to lower its net debt.

It said it expected to close the deal in the first quarter of 2020.-Reuters

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