UDG Healthcare snaps up US consultancy in £25m deal
Dublin-listed UDG Healthcare has sealed a deal to buy a US-based healthcare management consulting firm for up to $32m (£25m). The acquisition of Vynamic will sit in the group's Ashfield division, which provides commercialisation services to the pharma and healthcare industries.
"It is the company's first management consultancy acquisition and offers services which are highly complementary to the existing range of services provided by Ashfield," UDG said.
The deal will see $22m (£17m) paid up front, with the potential for a further $10m (£8m) if certain profit targets are met.
UDG Healthcare chief executive Brendan McAtamney said: "Vynamic is an excellent fit for UDG Healthcare, both strategically and culturally, and demonstrates our strategic commitment to developing our market-leading positions through geographic and services expansion."
UDG has been reinventing itself in recent years after selling legacy distribution businesses in order to focus on higher margin areas.
"We are positive on the Vynamic transaction, which is in line with UDG Healthcare's strategy of growing both its advisory capability and US presence," Davy analysts Allan Smylie and Andrew Young said, adding that they estimate the deal will add more than 2% to UDG's earnings per share in 2018.
UDG also indicated that it had received competition clearance for the acquisition of Sellxpert, a German contract sales outsourcing business. UDG will pay $14.4m (£11m) for the business.
Sangers - Northern Ireland's biggest wholesale supplier of drugs and pharmaceutical supplies - was formerly part of UDG Healthcare.
In 2015, UDG announced the sale of its supply chain services businesses, including Sangers (NI), to the American McKesson Corporation.
Sangers in Northern Ireland now operates as Sangers AAH. AAH is also part of the McKesson Corporation.
In the year to September 2015, Sangers AAH had pre-tax profits of £4.3m.
AAH is part of Celesio Group. But in 2014, McKesson Corporation became a majority shareholder in Celesio.
McKesson is based in San Francisco and operates in pharmaceutical and medical-surgical supply management, healthcare information technology and business and clinical services.