Feb 21 (Reuters) – Paladin Labs Inc said it
plans to buy a near 45 percent stake in South Africa’s Litha
Healthcare Group Ltd in a complex deal to expand its
footprint in the region.
The deal will see Paladin speed up its buyout of the near 55
percent of Pharmaplan it does not currently own. It will then
sell the business to Litha in a cash-and-stock deal.
Pharmaplan provides marketing and sales services for small
to mid-sized drug makers in South Africa and other sub-Saharan
territories.
Litha will issue 169.1 million shares at 2.75 rand (36
cents) apiece to buy Pharmaplan, but Paladin did not specify the
cash part of the deal. Paladin also agreed to buy an additional
73 million Litha shares from Blackstar Group at the
same price.
Paladin said it expects to spend C$48 million in cash and
issue 88,948 shares at C$44.97 each to complete the combined
transactions, which will make it Litha’s single largest
shareholder.
The deal is expected to be accretive to Paladin’s earnings
before interest, taxes, depreciation, and amortization (EBITDA)
immediately upon closing, the Canadian company said in a
statement.
Shares of Montreal-based Paladin were marginally off at
C$40.96 on Tuesday on the Toronto Stock Exchange.
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