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| Aspen's Australian headquarters--Courtesy of Aspen Pharmacare |
South Africa-based Aspen Pharmacare is selling off two drug portfolios to India's Strides Arcolab for a combined $301 million, to put extra cash in the pot as it gears up for international growth.
Aspen will hand over about 130 branded and generic drugs to Strides' Australian business for A$265 million ($209 million) and 6 branded products to Strides' Singapore unit for about $92 million.
"These transactions form part of Aspen's communicated strategic intent to focus attention in areas where most value can be added and to lessen complexity," the company said in a statement. It's a familiar tune for the company, as last week Aspen sold a portfolio of branded and generic products to serial dealmaker Endo International ($ENDP) for about $130 million.
Shedding some of its unwanted assets gives Aspen extra cash to fuel expansion elsewhere--and continue its international land grab. In 2013, the company snatched up a set of GlaxoSmithKline's ($GSK) heart medicines and a related manufacturing site in France for about $1.1 billion. The same year, it shelled out $1 billion to Merck & Co. ($MRK) for 11 products and API operations. Those two deals allowed Aspen to establish operations in Russia and Europe, and gain ground in Latin America and Asia.
The South African drugmaker seems to be continuing its upward trajectory, though the company is "looking the hardest" in Asia for potential deals, CEO Stephen Saad said earlier this year.
For Strides, the Australian buy gives it a bigger presence in a growing market. Drug sales there are expected to grow to $32.1 billion by 2020 from $22.7 billion in 2013, according to Global Data info cited by Bloomberg. The drugs Strides bought accounted for A$120 million ($94 million) in sales for fiscal year ended last June. Plus, Strides will inherit a product pipeline that includes a number of potential launches in the next 6 months, Strides said in a statement.
"The Aspen Australian generic pharmaceutical assets are a valuable and unique platform for Strides to re-build its business in Australia," Strides CEO Arun Kumar said in a statement. "Strong local management, a market-leading product portfolio supported by our in-house cost effective manufacturing, will be the key ingredients of our strategy for Australia."
- read Aspen's statement
- here's the Strides release (PDF)
- get the Bloomberg story
- read more from Reuters
Special Report: Top 10 generics makers by 2012 revenue - Aspen Pharmacare