Aurobindo Pharma Leads Acquisition Race for Zentiva in $5.5 Billion Deal

Aurobindo Pharma is leading the race to acquire Prague-based generic drugmaker Zentiva for up to $5.5 billion from Advent International. However, the company has stated that no binding agreements have been signed by its board. The acquisition would strengthen Aurobindo Pharma's presence in the European market.

Indian pharmaceutical giant Aurobindo Pharma is in advanced negotiations to acquire Prague-based generic drugmaker Zentiva from Advent International for an estimated $5-5.5 billion. The deal, if successful, would mark the largest acquisition by an Indian pharmaceutical firm to date. Aurobindo has secured a $4.75 billion credit line from MUFG and plans to contribute approximately $800 million from internal funds [3].

Zentiva operates in 30 countries with projected 2024 revenue of 1.70 billion euros and EBITDA of 400 million euros. The acquisition would significantly expand Aurobindo's presence in Eastern Europe and strengthen its position in the European generic drug market. Aurobindo's current market capitalization stands at Rs 63,684.90 crore, with its European business reporting a 16.6% increase in the June quarter [3].

The acquisition would also bolster Aurobindo's biosimilar pipeline, with the company developing robust biosimilars such as denosumab (Prolia) for osteoporosis, omalizumab (Xolair) for multiple cancer treatments, and bevacizumab (Avastin) for multiple cancer treatments. Aurobindo aims to achieve 40-60% margins in the EU biosimilar segment and aims for a blended 50% gross margin [1].

Industry watchers anticipate a formal announcement regarding the acquisition within the next two to four weeks, signaling the culmination of these high-stakes negotiations. The potential acquisition underscores Aurobindo's ambitious growth strategy and its commitment to expanding its global footprint in the pharmaceutical industry [3].

References:
[1] https://m.economictimes.com/industry/healthcare/biotech/pharmaceuticals/aurobindo-leads-race-for-5-5-bn-zentiva-deal-set-to-be-indias-biggest-pharma-buyout/articleshow/123394210.cms
[2] https://finance.yahoo.com/news/indias-aurobindo-pharma-leads-race-065052905.html
[3] https://scanx.trade/stock-market-news/orders-deals/aurobindo-pharma-eyes-record-breaking-5-5-billion-zentiva-acquisition/17196537