Taisho Nears $1.6 Billion Deal for Bristol-Myers Unit

Taisho Pharmaceutical Holdings Co. is nearing a deal to buy Bristol-Myers Squibb Co.’s French over-the-counter unit, people familiar with the matter said, as the Japanese drugmaker seeks to boost its overseas presence.

An agreement for the consumer-health business could be announced as soon as this week, the people said, asking not to be identified because the matter is private. A deal could value the OTC operations, known as UPSA, at about $1.6 billion, said the people.

U.S. pharma giant Bristol-Myers has sought to sell the unit amid a push to streamline its business globally to focus on other growth areas, the people said. Any deal would add to the $428.7 billion of announced acquisitions of health-care companies this year, 27 percent more than the same period in 2017, according to data compiled by Bloomberg.

Taisho shares fell as much as 4.05 percent Monday afternoon in Tokyo, hitting their lowest intraday level since Nov. 21, before recovering. They traded at 12,560 yen each by 2:02 p.m., giving the Tokyo-based company a market value of almost $10 billion.

Talks are still ongoing and may not result in a deal, the people said. A spokesman for Taisho declined to comment.

A spokeswoman for Bristol-Myers said the company is still considering options for the strategic review of UPSA it announced in June. She said relevant bodies would be informed as and when appropriate about the outcome, declining to comment further.

UPSA sells painkillers and flu medicines such as Dafalgan, Efferalgan and Fervex as well as nutritional treatments, its website shows. It was founded in 1935 and bought by Bristol-Myers in 1994.

Taisho, whose roots trace back to 1912, focuses the bulk of its business on OTC products, including energy drinks, cold medication and hair regrowth treatment. An acquisition of UPSA wouldn’t be the first deal Taisho has done with Bristol-Myers. In 2009, it agreed to buy the U.S. company’s Asia-Pacific OTC business, excluding Japan and China, for $310 million.

It’s been a busy year for the consumer-health sector globally. GlaxoSmithKline Plc agreed to a $13 billion acquisition of Novartis AG’s stake in their consumer joint venture in March, and a month later, Procter & Gamble Co. agreed to buy Merck KGaA’s consumer-health business in a 3.4 billion-euro ($3.8 billion) deal, the data show.

Japanese companies in particular have been scouting for growth overseas, taking advantage of low financing costs. Takeda Pharmaceutical Co. is on course to complete a $62 billion takeover of Shire Plc after shareholders cleared the deal this month.

17 December 2018


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