M&A, Pharma

Akorn in $640 million M&A deals for acquisition of Hi-Tech Pharmacal

Posted on 28 August 2013

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Akorn and Hi-Tech Pharmacal announced that they have entered into definitive M&A deals under which Akorn will acquire Hi-Tech for $640 million in cash.

Hi-Tech, the company being acquired in the M&A deals,  is a specialty pharmaceutical company developing, manufacturing and marketing generic and branded prescription and over-the-counter products.

Hi-Tech specializes in difficult to manufacture liquid and semi-solid dosage forms and produces and markets a range of oral solutions and suspensions, as well as topical ointments and creams, nasal sprays, otics, sterile ophthalmics and sterile ointment and gels products.

Hi-Tech’s Health Care Products division is a leading developer and marketer of OTC products.

Hi-Tech's ECR Pharmaceuticals subsidiary markets branded prescription products.

Under the terms of the M&A deals, Akorn will pay $640 million in cash, or $43.50 per share.

This represents a 23.5% premium over the closing price on August 26.

Akorn expects to achieve between $15 million and $20 million in annual run-rate synergies within 12 months of close.

The combined company resulting from the M&A deals, is expected to have annual revenues in excess of $500 million and the transaction is expected to be accretive to Akorn’s non-GAAP adjusted earnings per share immediately upon closing.

Assuming the transaction occurred on January 1, 2013 and assuming the full realization of synergies, the acquisition would have been approximately 40% accretive to Akorn’s expected 2013 non-GAAP adjusted earnings per share.


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