Valeant said to be in talks to acquire Egyptian drug maker Amoun

May 23, 2015
Valeant Pharmaceuticals International Inc. is in talks to acquire one of the largest drug makers in Egypt to expand in both veterinary and human medicines, according to people with knowledge of the matter.

Negotiations to buy Amoun Pharmaceutical Co. are at an early stage and may still fall apart, the people said, asking not to be identified because the discussions are private. Should the company fail to find a buyer, it may instead consider an initial public offering in London, two of the people said.

A sale of Amoun, which could value the company at $700-million to $800-million, according to one of the people, would be one of the largest acquisitions of a pharmaceutical company in the Middle East, signalling a growing desire among international companies to expand in the region’s fast-growing economies. Kellogg Co. agreed to acquire confectioner Bisco Misr in January, beating out competition from buyout firm Abraaj Group of the United Arab Emirates.

Amoun’s owners hired Goldman Sachs Group Inc. as an adviser, Bloomberg News reported in March. Shareholders are working with Goldman Sachs to pursue options including a sale, Chief Executive Officer Mohamed Roushdy said by phone at the time.

The company’s shareholders include emerging market-focused private-equity arms of Capital Group, Concord International Investments, and the Rohatyn Group, the New York-based fund that agreed to acquire Citigroup Inc.’s buyout business in 2013. The investors bought Amoun for about $450-million in 2006.

Valeant, based in Laval, Quebec, is seeking to become one of the world’s biggest drug companies, mainly through a series of acquisitions, as the pharmaceutical industry rushes to consolidate.

Last year it lost out to Actavis PLC. in an attempt to acquire Botox-maker Allergan Inc., through a joint venture with Bill Ackman’s Pershing Square Capital Management LP. In March, Valeant beat Endo International PLC in a bidding war to acquire Salix Pharmaceuticals Inc. for $11.1-billion.

Representatives for Amoun, Rohatyn and Valeant declined to comment, while representatives for Capital Group and Concord International didn’t respond to requests for comment. Bloomberg