Valeant Pharmaceuticals International, Inc. says it has signed an agreement to acquire iNova, a private Australian pharmaceutical group in a deal that could be worth as much as $714-million.
iNova sells and distributes a range of prescription and over-the-counter products in Australia, New Zealand, Southeast Asia and South Africa.
Valeant , the Canadian-American company formerly known as Biovail Corp., said early Monday it will pay iNova shareholders $625-million (Australian) up front and up to an additional $75-million if certain milestones are reached.
At current exchange rates, that translates to about $714-million (Canadian).
"This transaction not only transforms our operations in the Australian market, but provides us with a beachhead in both Southeast Asia and South Africa," said Michael Pearson, chairman and chief executive of Valeant.
"iNova has a talented management team that has created a strong business operation ahead of an intended initial public offering and with the current market softness, Valeant has a unique opportunity to acquire iNova and integrate our Australian operations into the broader iNova Asia Pacific business."
The sellers are Archer Capital, a private Australian investor, Ironbridge and some minority management shareholders.
iNova's 2011 revenue is expected to be about $200-million, with revenue growing by about 10 per cent a year over the last four years.
The company makes therapeutic weight management drugs such as Duromine and over the counter medications for colds and coughs such as Difflam and Duro Tuss.
The transaction is subject to certain closing conditions and post-closing adjustments, and is expected to be immediately accretive.
Valeant, based in Mississauga, is focused on neurology and dermatology therapeutic areas primarily in Canada, the United States, Mexico, Brazil, Central and Eastern Europe and Australia.
In September 2010, Valeant and Biovail Corp. merged to become one company.
Valeant has grown rapidly since that time mainly through acquisitions, the most recent the takeover of Edmonton-based Afexa Life Sciences Inc., maker of the Cold-FX flu treatment.
Valeant employs about 5,000 people worldwide.