Japan's Takeda to acquire Swiss drugmaker Nycomed for $13.6 billion

Takeda Pharmaceutical Co proposes to acquire privately-held Swiss pharmaceutical firm Nycomed, for €9.6 billion ($13.6 billion). Japan's largest drugmaker wants to use its cash pile to boost its presence in Europe and the emerging markets.

Asia's largest pharmaceutical company will pay $13.6 billion in cash - the biggest overseas purchase by a Japanese company since Japan Tobacco bought UK-based Gallaher for $19 billion and is Takeda's second major acquisition after buying cancer specialist Millennium Pharmaceuticals of the US in 2008, for $8.8 billion.

Zurich-based Nycomed is owned by a consortium of private equity firms comprising of Nordic Capital, DLJ Merchant Banking Partners (a Credit Suisse affiliate), Coller International Partners and Avista Capital Partners.

Nycomed's diversified product portfolio includes both established prescription pharmaceutical products as a primary revenue driver, and over the counter (OTC) products. It has a strong European commercial network and is aggressively growing in emerging markets which account for more than 50 per cent of global pharmaceutical growth.

Nycomed reported €3.2 billion in revenue in 2010 and generated earnings of €774.9 million before interest, taxes, depreciation and amortisation. The company's revenue from emerging markets stood at 39 per cent, with sales in Latin America up 29.8 per cent and sales in Russia up 23.3 per cent.

It's top product is 'Pantoprazole' for heartburn, a field that Takeda knows well, with its own `Prevacid', a former blockbuster heartburn drug, which is no longer under patent protection.