29 September 2009

Abbott deals for Solvay pharma unit

In a move to expand its international presence, Abbott Laboratories will pay $6.6 billion to pick up the pharmaceutical business of Belgian chemicals maker Solvay.

The deal also gives the company $500 million in additional research and development capacity, which can drive future pharmaceutical unit growth, said Miles D. White, chairman and chief executive of North Chicago, Ill.-based Abbott.

Solvay said they wanted to make the deal so they can focus its business on chemicals and plastics.

“We are building a new refocused group with the financial means to further accelerate sustainable growth,” said Alois Michielsen, Solvay’s chairman.

Solvay said the value of the deal could jump by another $439 million if they meet sales targets for certain drug products.

In addition, Abbott would also take on liabilities worth about $584 million.

Abbott makes and markets pharmaceutical and medical products in more than 130 countries and employs more than 72,000 people.

Solvay Pharmaceuticals is a group of companies that employs 9,000 people worldwide and had sales of $4 billion (€2.7 billion) in 2008. The Solvay Group as a whole employs more than 29,000 people in 50 countries. Its 2008 consolidated sales were $13.9 billion (€9.5 billion).

The sale should close in the first quarter of 2010, pending antitrust approval from the EU and U.S.

For related information, go to www.isa.org/productivity.