Recipharm completes acquisition of Kemwell AB and Cirrus Pharmaceuticals Inc.

Acquisitions comprise operations in the US, Sweden and India.

The acquisition now to complete is comprising Cirrus Pharmaceuticals Inc., with operations in the US, with services including development of inhalation, liquid, semi-solid, solid and parenteral products with emphasis on early formulation work, as well as development of analytical methods and testing, and Kemwell AB in Sweden, with services primarily including manufacturing of APIs, solids and semi-solid formulations. The sellers of Kemwell’s operations in the US and Sweden are Kemfin Holdings Private Ltd and a minority seller (Minority Seller).

The acquisition price for Kemwell AB and Cirrus Pharmaceuticals Inc. amounts to approximately $85 million (approximately SEK 706 million) on a cash and debt free basis. With regard to the estimated net debt of $10.2 million (approximately SEK 85 million), the preliminary purchase price amounts to approximately $75 million (approximately SEK 621 million), of which $55 million (approximately SEK 458 million) is to be paid through a share issue of class B shares at a subscription price of SEK 145.06 per share, and the remainder in cash. The Board of Directors, by virtue of the authorisation from the Extraordinary General Meeting on 10 May 2016, resolved on a share issue in kind of 3,159,572 series B shares to the sellers of Kemwell AB. The new shares are expected to be registered with the Swedish Companies Registration Office around 26 May 2016. The cash part of the purchase price for Kemwell AB and Cirrus Pharmaceuticals Inc. preliminarily amounts to approximately $19.6 million (approximately SEK 163 million).

Kemfin and the Minority Seller have undertaken not to sell or in other respects transfer their respective shareholdings in Recipharm in respect of the share issue in kind during a period of 12 months from the closing date.