Private equity firm EQT has proposed to acquire 100% of Karo Pharma, a Swedish pharma company, for around SEK5.97bn ($654m).
Karo Pharma develops and markets products for pharmacies and also directly to the healthcare sector. The specialty pharma company is said to have a strong presence in the Nordic region.
The product portfolio of the Swedish pharma firm includes over-the-counter and prescription pharmaceuticals in addition to medical devices. Included in the portfolio are Triolif, Vagisan, Locobase, Viruseptin, Allévo, Swereco and Dosett among others.
As per the proposal, EQT VIII will acquire each of the shares of the pharma company for SEK36.90 ($4.04) in an all-cash deal.
The offer from EQT implies a premium of nearly 25.3% compared to the closing price for the Karo Pharma share on Nasdaq Stockholm on the last day of trading prior to its issuance.
EQT VIII, in a statement, said: “EQT places great value on Karo Pharma’s organization, and expects that the Offer will support growth and create long-term positive effects for employees and other stakeholders.
“EQT VIII does not expect the Offer to have any negative impact for Karo Pharma’s organisation, employees, including their terms of employment, or on the locations of Karo Pharma’s operations.”
The board of directors of the pharma company has unanimously recommended the company’s shareholders to accept the offer made by the Swedish private equity firm through its EQT VIII fund.
Karo Pharma board of directors executive chairman Anders Lönner, along with the company’s board member Anders Johansson, who together hold a stake of around 13.6% in the company, have declared their intention to accept EQT’s offer.
The pharma company’s board of directors concluded that EQT VIII is very well placed to support its strategy owing to the fund’s vast sector experience along with financial resources and focus on long term value creation.
In March 2018, the Swedish pharma company made its first step to establish a European footprint by acquiring a product portfolio from LEO Pharma for €260m.
The portfolio included 10 pharmaceuticals mainly within the therapeutic areas of infection, cardiovascular and dermatology.