AmerisourceBergen Corporation (ABC) is one of the world’s largest pharmaceutical services companies.The company has been regularly entering into deals to expand its global footprint.
In order to expand its presence in Brazil, AmerisourceBergen recently announced that it has completed the acquisition of a minority stake in Profarma Distribuidora de Produtos Farmacêuticos S.A.
Profarma Distribuidora de Produtos Farmacêuticos S.A is a leading pharmaceutical wholesaler in Brazil. AmerisourceBergen and Profarma have entered into a joint venture to provide enhanced specialty distribution and services to the Brazilian markets.
AmerisourceBergen has paid approximately $110 million for a 19.9% minority stake in Profarma and a 50% stake in the specialty joint venture.
The transaction is not expected to have a meaningful impact to the bottom line in fiscal 2014.
We are positive on the recent deals signed by AmerisourceBergen, which should boost its top line. In Mar 2013, the company entered into a strategic agreement with Walgreen (WAG) and Alliance Boots GmbH, effective from Sep 2013. The agreement includes a ten-year pharmaceutical distribution contract with Walgreen and access to generic drugs and related pharmaceutical products through the Walgreens Boots Alliance Development joint venture. In return, both Walgreens and Alliance Boots have been granted rights to jointly purchase a minority equity position in AmerisourceBergen.
The agreement also allows AmerisourceBergen access to generics and related pharmaceutical products through Walgreens Boots Alliance Development GmbH, a global sourcing joint venture between Walgreens and Alliance Boots.
AmerisourceBergen currently carries a Zacks Rank #2 (Buy). Some better-ranked stocks in the broader healthcare sector include Shire (SHPG), Allergan (AGN) and Regeneron Pharmaceuticals (REGN). While Regeneron Pharma carries a Zacks Rank #1 (Strong Buy), Shire and Allergan carry a Zacks Rank #2 (Buy).
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