Teva Pharmaceutical Industries has struck a deal to buy Mexican drugmaker Representaciones e Investigaciones Médicas SA (Rimsa) for $2.3 billion (£1.5 billion) to strengthen its presence in Latin America.
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It is Teva’s second real obtaining as of late.
“This acquisition delivers on our strategy of increasing our presence in key emerging markets in order to position Teva for long-term growth in these markets”, Teva president and chief executive Erez Vigodman said in a statement.
The acquisition comes a few months after the Israeli-based firm agreed to buy Allergan’s generics for $40.5bn, further consolidating its position as the world’s number one generic drug manufacturer.
“For 45 years, Rimsa has operated as a leading pharmaceutical company in Mexico, the second largest healthcare market in Latin America, with a high growth, unique and diversified business model”.
Several companies have been pursuing acquisition agreements in the Latin American markets – factors like an aging population, growing middle class, easier access to medical products as well as initiatives undertaken by governments to promote the use of cheaper generic medicines are expected to drive growth in these markets.
The company had revenue in 2014 of $227 million with an annual growth of 10.6% since 2011. Rimsa will bring a portfolio of specialty products that are protected by patents. “We see this as an extraordinary deal for Teva from a strategic viewpoint”, said Nomura expert Shibani Malhotra.
Siggi Olafsson, CEO of Teva’s worldwide generic business, said the company would expand on Rimsa’s notoriety, sales power and client base to present extra forte and generic Teva meds to patients in Mexico and over the locale.
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The deal, funded with cash on hand and lines of credit, should close in Q1. Teva expects the acquisition to be accretive from the first quarter of 2017.
