In the largest acquisition in the Irvington company”™s history, Prestige Brands Holdings Inc. will pay $660 million in cash for 17 over-the-counter pharmaceutical brands of GlaxoSmithKline plc.
Brands include the pain reliever Ecotrin, Tagamet and Fiber Choice gastrointestinal treatments and Sominex, the sleep aid drug.
The purchases are expected to be completed in the first half of 2012.
Prestige Brands CEO Matthew M. Mannelly called the transaction with Great Britain”™s GSK “a transformational event” for his company. When completed, the company expects annual corporate revenue of approximately $600 million, with its OTC business segment representing 85 percent of revenue and 90 percent of profits.
Prestige Brands Chief Financial Officer Ron Lombardi said the cash price will be structured as asset purchases that result in substantial tax benefits, creating an effective purchase price of $535 million. They will be funded through a new credit facility and issued bonds.
Prestige Brands Holdings in the last year also paid $76 million to acquire the Dramamine business in the U.S. from the Johnson & Johnson division of McNeil-PPC Inc. Dramamine is the top OTC brand in the U.S. for treatment of motion sickness, with an estimated 32 percent market share when the deal was announced one year ago.
The Irvington holding company”™s brand names include Efferdent and Effergrip denture-care products, Luden”™s cough drops, Chloraseptic sore-throat treatments, Clear Eyes eye-care products, Compound W wart removers and Comet and Spic and Span household cleaners.
