Aspen Is Said to Weigh Infant-Formula Unit Sale to Lactalis
(Bloomberg) -- Aspen Pharmacare Holdings Ltd. is in talks to sell its infant formula business to French dairy group Lactalis International as Africa’s largest drugmaker seeks to cash in on the division, according to people familiar with the matter.
The business could fetch about $1 billion, said the people, who asked not to be identified because the negotiations are private. A deal could be announced as early as this week, though no final decisions have been made and a rival bidder could still emerge with a last-minute offer, they said.
The shares jumped as much as 5.7 percent and traded 2.3 percent higher at 271.92 rand as of 4:17 p.m. in Johannesburg. That values Aspen at 124 billion rand ($8.2 billion).
Following the Bloomberg report, Aspen put out out a statement saying the company is in talks to sell the unit, without giving further detail. A representative of Lactalis declined to comment.
Aspen said in January it was weighing options for the infant-formula unit, known within the Durban, South Africa-based drugmaker as “nutritionals,” following an unsolicited approach last year. The company has been using the business to drive a push into China, where it gained approval to sell its Alula formula products earlier this year.
The formula unit had previously attracted interest from companies including Reckitt Benckiser Group Plc, Perrigo Co. and Australia’s iNova Pharmaceuticals, controlled by Pacific Equity Partners and Carlyle Group, people familiar with the matter said in May.
The business had sales of 3.2 billion rand ($212 million) in the 2017 fiscal year, about 8 percent of the company’s total. That was down about 3 percent from a year earlier.
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