Insight journal - Dealtalk

Warner Chilcott Luring Drug Buyers With Most Free Cash: Real M&A

Posted on 04 May 2012

Tags: ,

Warner Chilcott offers potential acquirers the chance to buy a company in a M&A deal, that throws off more cash from selling contraceptives and colitis treatments than any specialty drugmaker in the world.

Shares of the Dublin-based company surged to a nine-month high this week after Warner Chilcott said it’s exploring M&A options and holding talks with possible buyers.

The $5.5 billion company, which gained 27 percent since takeover speculation emerged less than a week ago, still has a free cash flow yield that’s 20 percent of its share price, about 10 times more than the median for comparable drugmakers with at least $1 billion in market value, according to data compiled by Bloomberg.

While analysts are predicting Warner Chilcott’s sales will decline this year as it faces competition from generic copies of its drugs, Invesco Ltd. and RBC Capital Markets said the company could fetch at least $27 a share in a takeover, a 23 percent premium to yesterday’s price.

A larger drug company could benefit by expanding sales of Warner Chilcott’s top brands such as Asacol, which treats intestinal inflammation, and cutting costs to boost profits, Invesco said.

 

Related

Read: more on M&A deals in pharma, biotech, life science partnering deal news, insights and glossary

Read: Big pharma deal news - latest deal news for top 50 pharma / big pharma companies

Report: Partnering Deals and Alliances with Warner Chilcott 

View: Top 50 pharma – overview of top 50 pharmaceutical companies by revenue – partnering activity, deal news, partnering dealtalk

View: Current Partnering’s Partnering Scorecard – view top life science partnering deals by value

View: Current Partnering’s Deal Metrics – the latest deal trend infographics for life science deal making

View: Current Partnering’s Big Pharma Deal Making Scorecard – latest trends in big pharma deal making activity

View: Current Partnering’s Big Biotech Deal Making Scorecard – latest trends in big biotech deal making activity

Signup: Current Partnering Dealmakers Update – weekly newsletter providing the latest life science industry deal news, deal making trends, partnering events – sign up now

Signup: Current Agreements Deals Review – monthly newsletter - reviewing the previous month’s life science deal making – partnering, M&A and financing – sign up now

Subscribe: Current Agreements life sciences partnering, M&A and financing deals database – find out more

Follow us on: LinkedIn Current Partnering | LinkedIn Business Development Network | @Currentpartner on Twitter

Print Friendly, PDF & Email

Leave a Reply

 

cpbannerad300x150new2gif
rauconbadgejpg
amsbanner300x150jpg
cpbannerad300x150new1gif
e79banner300x150gif
e78banner300x150animgif