UCB, Advent International and Avista Capital Partners mutually agree to terminate acquisition agreement for Kremers Urban
Mutual agreement driven by conflicting timing for the acquisition (including the financing) and the regulatory process
UCB's intention to divest Kremers Urban, its US specialty generics business, remains unchanged
UCB's 2014 financial outlook unchanged
Brussels (Belgium), 16 December 2014 – 19:00 (CET) – regulated information – UCB, Advent International ("Advent") and Avista Capital Partners ("Avista") announced today that they have mutually agreed to terminate their acquisition agreement, previously announced on November 7, 2014, pursuant to which Advent and Avista would have acquired UCB's US specialty generics subsidiary, Kremers Urban Pharmaceuticals Inc. ("KU" or "Kremers Urban"), for gross cash proceeds of US$1,525 million. The decision to terminate the acquisition agreement was primarily driven by an unexpected conflict in the timing for the acquisition (including the financing) and the regulatory process previously announced by KU on November 14, 2014.
On November 14, 2014 KU announced that it had been informed by the U.S. Food and Drug Administration (FDA) that the agency requested an additional bioequivalence study based on recently issued draft guidance to confirm the therapeutic equivalence of KU's methylphenidate hydrochloride extended-release (ER) tablets (CII) to the category reference drug Concerta® (registered trademark of ALZA Corporation). KU intends to perform the requested additional study and will work with the agency in the best interests of patients.
"We are of course disappointed that we could not complete the transaction as planned at this time but believe that the mutual termination is the right step to allow time for the needed evaluation of the best way forward and as a result to create the most value," said Detlef Thielgen, CFO of UCB. "While we are working on clarifying the situation around methylphenidate ER we will continue the divestiture process for Kremers Urban."
UCB's intention to divest its US specialty generic business is unchanged. Today's announcement does therefore not impact the 2014 financial outlook UCB communicated on November 7, 2014 and which remains unchanged at: total revenue of approx. € 3.15-325 billion, underlying profitability (recurring EBITDA) of € 590-620 million and core earnings per share (Core EPS) of € 1.40-1.55.
More details of the IFRS impact of this transaction will be disclosed as part of the 2014 results and the Annual Report 2014 publication, scheduled for 27 February 2015.
George Stevenson is continuing to serve as President and CEO of Kremers Urban Pharmaceuticals Inc.
Lazard is acting as lead financial advisor to UCB, BNP Paribas is acting as additional financial advisor and Covington & Burling LLP is acting as legal counsel to UCB.
For further information
Investor Relations, UCB
Global Communications, UCB
T +32.2.559.94.14, [email protected]
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Media Relations, UCB
T+32.2.559.92.64, [email protected]
UCB, Brussels, Belgium (www.ucb.com) is a global biopharmaceutical company focused on the discovery and development of innovative medicines and solutions to transform the lives of people living with severe diseases of the immune system or of the central nervous system. With more than 8500 people in approximately 40 countries, the company generated revenue of € 3.4 billion in 2013. UCB is listed on Euronext Brussels (symbol: UCB). Follow us on Twitter: @UCB_news
About Kremers Urban Pharmaceuticals Inc. (KU)
KU is the generic subsidiary of UCB in the US. It is a specialty generic pharmaceutical company focused on difficult, "high barrier" to entry generic products. To learn more visit www.kremersurban.com.
About Advent International
Founded in 1984, Advent International is one of the largest and most experienced global private equity investors. Since inception, the firm has invested in more than 290 companies in 39 countries and today has $34 billion in assets under management. With offices on four continents, Advent has established a globally integrated team of over 180 investment professionals across North America, Europe, Latin America and Asia. The firm focuses on investments across five core sectors, including business and financial services; healthcare; industrial; retail, consumer and leisure; and technology, media and telecom. After 30 years dedicated to international investing, Advent remains committed to partnering with management teams to deliver sustained revenue and earnings growth for its portfolio companies. For more information, visit www.adventinternational.com.
About Avista Capital Partners
Avista Capital Partners is a leading private equity firm with approximately $6 billion under management and offices in New York, Houston and London. Founded in 2005, Avista makes controlling or influential minority investments in growth-oriented energy, healthcare, communications & media, industrials, and consumer businesses. Through its team of seasoned investment professionals and industry experts, Avista seeks to partner with exceptional management teams to invest in and add value to well-positioned businesses.
For more information on Avista please visit www.avistacap.com.
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