AmerisourceBergen To Buy PharMEDium, Stock Slips

AmerisourceBergen (ABC) said Tuesday that it has agreed to buy PharMEDium Healthcare Holdings from Clayton, Dubilier & Rice for $2.58 billion as the pharmaceutical sourcing and distribution service company continues to bulk up its business via acquisitions.

Privately held PharMEDium Healthcare is a national provider of outsourced compounded sterile preparations to acute care hospitals in the U.S.

AmerisourceBergen is no stranger to acquisitions. Earlier this year, it bought animal health product distribution company MWI Veterinary Supply in a deal valued at $2.5 billion.

The PharMEDium acquisition is expected to be 22 cents to 26 cents accretive to AmerisourceBergen’s adjusted net earnings per share in fiscal 2016 and is expected to generate about $30 million in synergies by fiscal 2018, the company said in a press release.

Wall Street didn’t seem impressed with the deal. AmerisourceBergen shares closed down 2.1% to 93.03 on the stock market today.

PharMEDium is a provider of customized outsourced CSPs that meet specific hospital and physician clinical needs and quality standards in formulations that are not otherwise commercially available, according to the press release. It serves over 3,000 hospital customers in all 50 states.

“The acquisition of PharMEDium strengthens our core business and meaningfully expands our innovative service offerings for health systems,” said AmerisourceBergen CEO Steven Collis in the release.

“PharMEDium is a compelling addition to our business, which allows us to provide differentiated offerings and further increases our ability to drive both value and efficiency for our health systems customers.”

The transaction, which is subject to regulatory review and other customary closing conditions, is expected to close in the first quarter of fiscal 2016, which ends Dec. 31, 2015.

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AmerisourceBergen is in IBD’s Medical-Wholesale Drug/Suppliers industry group. Other large members of the group are McKesson (MCK) andCardinal Health (CAH).

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