Natco Pharma offers to acquire stake in South African pharma firm Adcock Ingram Holdings for Rs 2000 crore

Hyderabad: NATCO Pharma Limited has submitted a firm intention offer to Adcock Ingram Holdings Limited, a South African pharmaceutical company, to buy out minority shareholders for a cash offer of R75.00 (US$4.271 ) per share. Should the offer be accepted, NATCO Pharma will hold a 35.75% stake in Adcock Ingram, valued at R4 billion (US$226 million ).

Adcock Ingram is estimated at a valuation of R11 billion (~US$ 632 million). It is envisaged that post-acquisition, Adcock Ingram will continue to operate as a private South African business, supported by two substantial strategic shareholders, Bidvest at 64.25% and NATCO at 35.75%, including a prior held stake. Adcock Ingram generated revenue of R9.6 billion (US$536 million*) in the financial year June’24 and delivered a gross margin of 33.4%. The company achieved EBITDA of R1.4 billion (US$78 million*) at a margin of 14.6%, and a profit after tax of R814 million (US$45 million*).

Following the past year’s performance, the company delivered revenue of R4.7 billion (US$262 million) for the period ending December’24 and achieved EBITDA and profit after tax of R677 million (US$38 million*) and R389 million (US$22 million), respectively.

Post-transaction, NATCO will consolidate 35.75% of Adcock Ingram's net profits in NATCO’s financial results in accordance with its shareholding. For Adcock Ingram, this transaction is expected to bolster its already substantial local market share, cost competitiveness and provide the company with significant opportunities for new product and geographic expansion.