IVAX Corp looking to acquire LabChile for $395 million in cash

IVAX Corp has emerged as the company most interested in acquiringLaboratorios Chile, the country's largest pharmaceutical producer. Rumors of a sale have been rife since the latter confirmed that its major backers, Comercial e Inversiones Portfolio and Portfolio Inversiones, were in preliminary talks with potential buyers (Marketletter May 7).

IVAX has made an offer to the two shareholding groups to acquire all the common stock of LabChile, which would involve paying $395 million in cash for the firm. The tender offer will be launched simultaneously on the Santiago and New York Stock Exchanges, and it was noted that LabChile is the only Latin American pharmaceutical company with American Depositary Receipts traded on the latter.

As well as its strong domestic position, LabChile is among the major players in the pharmaceutical market in Argentina and Peru, and it manufactures and markets over 900 branded and generic products in the aforementioned three countries. Its main therapeutic areas include respiratory and antibiotic products, and it also has strong franchises in the cardiovascular, neurology and gynecology markets. Full-year 2000 revenues were in the region of $173 million.