The sale of emergency contraception products such as Plan B One-Step to Foundation Consumer Healthcare has been completed by Teva Pharmaceutical Industries Ltd (ADR)(NYSE:TEVA) at a price of $675 million. According to the interim chief financial officer of Teva, Michael McClellan, the sale was part of the pharmaceutical firm’s divestiture efforts aimed at disposing of non-core business assets.
Two months ago Teva sold Paragard, another contraceptive device, to CooperSurgical at a price of $1.1 billion. Currently the Israeli pharmaceutical giant is reeling under a huge debt load.
“Teva is extremely pleased to complete the sale of Plan B One-Step and value brands of emergency contraception, which brings a significant influx of cash into the organization to further progress our ability to repay term loan debt,” said McClellan in a statement.
Women’s health business
Teva is also pursuing other divestiture opportunities and this includes an agreement it has inked with PE firm CVC Capital Partners to sell assets in its women’s health business. These assets include a portfolio of products in areas such as osteoporosis, menopause, fertility and contraception. Teva stands to earn approximately $703 million from this deal. Together with other divestitures, Teva expects to generate a minimum of $2.3 billion by the end of this year.
The sale of some of its contraceptive assets comes in the wake of Israeli media reporting that Len Blavatnik, a billionaire businessman, is eyeing the acquisition of a big stake in Teva. Currently the stock of the drug firm has a reached a 17-year low following the annual profit forecast being reduced. According to some of the media outlets Blavatnik could buy a stake worth approximately $3 billion which would translate to roughly 25% shareholding as the market capitalization of Teva currently stands at $12.3 billion.
Blavatnik’s investment could be done either via a private stock purchase which would assist Teva deal with a debt burden of close to $35 billion. The shares could also be acquired from Allergan plc Ordinary Shares (NYSE:AGN) which got a 10% stake in Teva after the Israeli drugmaker purchased its generics business at a price of $40.5 billion.
On Monday shares of Teva Pharmaceutical Industries rose by 8.86% to close the day at $12.41.