Endo International To Buy Dava Pharma To Boost Generics Portfolio

(RTTNews) - Drugmaker Endo International plc (ENDP, ENL.TO) said Tuesday that it has agreed to acquire privately-held Dava Pharmaceuticals, Inc. for $575 million in cash. The company will pay an additional cash consideration of up to $25 million, contingent on the achievement of certain sales milestones.

Fort Lee, New Jersey-based Dava Pharma specializes in marketed, pre-launch and pipeline generic pharmaceuticals. The transaction is expected to be completed in the second half of 2014.

Endo has global headquarters in Dublin, Ireland, and U.S. headquarters in Malvern, Pennsylvania.

Endo noted that the acquisition of Dava Pharma will add high-margin marketed generics portfolio and robust near-term ANDA pipeline to the company's existing generics portfolio. The company expects the transaction to be immediately accretive to its fiscal 2014 adjusted earnings per share.

Rajiv De Silva, president and CEO of Endo said, "The acquisition of DAVA is another step in our pursuit of accretive and strategic external growth opportunities where we see a clear path to meaningful upside and synergies. DAVA is well-positioned for continued strong and highly predictable financial performance with its existing commercial portfolio and attractive near-term pipeline, and is a natural fit for our generics business."

Dava operates a generics franchise with 2013 revenue of about $131 million and adjusted EBITDA of about $100 million. The company's generics portfolio includes 13 on-market products in a variety of therapeutic areas.

In addition, Dava has assembled a product pipeline across a multitude of therapeutic categories, including recent launches of generic Doxycycline and Cefdinir. Dava also expects over five products to be launched in 2015, and more than 20 additional products to be launched over the next several years.

Skadden, Arps, Slate, Meagher & Flom LLP is acting as Endo's legal counsel.

For Dava, Oppenheimer & Co. Inc. is acting as its lead financial advisor, while Dechert LLP is acting as its legal counsel. Jefferies LLC also advised Dava on the transaction.

ENDP is trading at $71.26, up $2.46 or 3.58 percent on a volume of 533,742 shares.