Dec. 21 (Bloomberg) - Sanofi-Aventis SA agreed to buy Chattem Inc., the maker of Gold Bond medicated body powder, for $ 1.9 billion to enter the U.S. Consumer Health Care Market.
Sanofi will pay $ 93.50 a share in cash, Which is 34 percent above Chattem's closing price is Dec. 18, the Paris-based drugmaker said today. The purchase will create the world's fifth-largest consumer health company by revenue, Sanofi said. The company plans to use the deal to convert its Allegra allergy drug to an over-the-counter medicine marketed by Chattem.
The acquisition is the second-biggest by Sanofi Chief Executive Officer Chris Viehbacher, 49, since he took the helm a year ago. He's done more than a dozen deals in emerging markets, vaccines and now Consumer Healthcare Thurs replace revenue that will be Lost to generic competition. Products that account for 20 percent of Sanofi's annual sales will lose patent protection by 2013.
"It makes sense in that they were fairly weak in Consumer Health Care in the U.S. and this now makes Sanofi a global OTC player, "Eric Le Berrigaud, an analyst at Raymond James in Paris, said in a telephone interview. "It also gets some momentum back into revenues, and margins are not Significantly lower than in the pharma business so it will not put margins under pressure."
Sanofi, the best performer among Europe's five biggest drugmakers this year, rose 11 cents, or 0.2 percent, to close at 54.81 euros in Paris trading. Chattem surged $ 22.89, or 33 percent, to $ 92.87 at 11:59 am in New York.
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