Reykjavik, Iceland, 28 March 2006 - Actavis Group (ICEX: ACT), the international generic pharmaceuticals company, announced today that it has agreed to acquire Sindan, a leading European generic pharmaceutical company specializing in the manufacturing and distribution of oncology products. The total consideration on a debt-free basis is EUR147.5 million (US$177 million) in cash, and as at the acquisition date Sindan has a cash balance of approximately EUR14 million (US$17 million).

 

Strategic rationale
The acquisition of Sindan, headquartered in Bucharest, provides Actavis with access to a new therapeutic field and a strong development and manufacturing expertise for oncology products. In addition Actavis will gain a solid platform in the Romanian market from which to achieve future growth.  Sindan has grown at a rapid rate in recent years and has seen its revenues almost double between 2002 and 2005.
Key benefits of the transaction include:
 
* Actavis will gain access to Sindan's marketing and distribution network in 6 countries, with 7 new entries planned in 2006, as well as low cost manufacturing and development facilities from which it can leverage a cost efficient platform to drive future growth and expansion.

* Actavis will immediately have a position in the rapidly growing oncology industry which is expected to be the fastest growing pharma segment over the next three years.

* Actavis will become one of the leading players in the Romanian market, which is expected to grow faster than most other European regions in the coming years.

* There is no overlap between the two companies and Sindan's strong oncology product portfolio complements Actavis' strengths in oral solid-dose products.

* Following the acquisition, Actavis will have one of the broadest portfolios in the generics sector. Sindan's 31 oncology products will add to Actavis' current portfolio of 600 products.

* The enlarged Group will benefit from products in Sindan's portfolio that can be marketed in Actavis' existing markets and vice versa.

 

Sindan is expected to have revenues of approximately EUR80 million (US$96 million) in full-year 2006 and EUR100 million (US$120 million) in 2007.  The EBITDA margin of Sindan for 2006 is expected to be approximately 22% for 2006 and 23% for 2007.

 

About Sindan
Pioneered in 1991, following the privatisation of the R&D Department of the Oncology Institute in Bucharest, Sindan employs 224 people and holds a strong position in its domestic market. Sindan's niche oncology products, both oral dosage and injectables, are very competitive in its international markets.

 

Sindan develops, manufactures and distributes a wide range of oncology compounds and is successfully entering a growing number of export markets including Romania, the UK, Poland, US, Japan, Germany, Italy and Spain. In addition, the Company has traditionally had a strong position in many Central and Eastern European markets and generates sales in Bulgaria, Hungary, Poland, the Czech Republic, Slovakia and Russia.  Sindan's Bucharest production facility is approved by MHRA for sales in the European Union and a US FDA inspection is pending.

During the period 2002 to 2005, Sindan's revenues almost doubled, representing a CAGR of 26%. The Company's unaudited accounts for 2005, show revenues of EUR68 million (US$82 million) and EBITDA of EUR17 million (US$20 million).

 

Financing
The purchase price of EUR147.5 million (US$177 million) will be paid in cash from Actavis' existing committed bank facilities.

JP Morgan acted as sole financial advisor to Actavis and USB for Sindan.

 

Outlook
In addition to making further acquisitions to lead the consolidation of a still fragmented industry, Actavis is committed to driving further organic growth through innovative product launches, penetration of new markets and regulatory approvals of new generic pharmaceuticals. 
 
Impact on 2006 guidance
Sindan will be fully integrated into Actavis Group accounts as of 1 April 2006. Sindan is forecasted to achieve revenues of approximately EUR80 million (US$ 96 million) in 2006 and EUR100 million (US$120 million) in 2007.  Including the effect of the Sindan acquisition from 1 April 2006, the combined Actavis Group is expected to have revenues for FY 2006 of EUR1.36 billion with an average EBITDA margin of 20%, and revenues for FY 2007 of EUR1.6 billion with an average EBITDA margin of 20%.

 

Commenting on the acquisition, Mr Robert Wessman, President and CEO of Actavis, said:
"Sindan has a very strong track record and as one of the leading players in its field, represents a strong strategic fit for the Actavis Group. Today's acquisition is a significant development for our business as Sindan provides Actavis with further diversity in our product portfolio and a strong foothold in the fast growing oncology industry. Sindan will now enable Actavis to compete in this market. Sindan will enhance to our growing presence in Europe, and the combination of our two businesses will serve to strengthen our distribution, marketing and low cost manufacturing and development capabilities throughout the region."

 

Analyst meeting
An analyst meeting will be held today, 28 March 2006 at 16:00 GMT, at Nordica Hotel, for analysts and investors. Power point slides, along with other press material, can be accessed through www.actavis.com, following the meeting.

 

About Actavis
Actavis Group is an international generic pharmaceutical company, founded in 1956, specialising in the development, manufacture and sale of generic pharmaceuticals. Headquartered in Reykjavik, Actavis has development and manufacturing facilities in Iceland, Bulgaria, Turkey, Malta, Serbia and the USA. Actavis' intellectual property has resulted in Actavis being first to market with generic products when patents expire. Actavis' recent acquisition of Alpharma's generics business places the company among the five leading companies in the generic pharmaceuticals market.  Actavis currently has operations in 32 countries with approximately 10 thousand employees.

 

For further information, please contact:
 
Actavis Group
Robert Wessman, President & CEO
+354 535 2300
 
Halldor Kristmannsson, VP of Corporate Communications
+354 535-2300 / +354 840-3425
hkristmannsson@actavis.com

 

Edelman (London)
Nick Barron
+44 207 344 1561

 

Financial Dynamics (New York)
Charlie Armitstead    
+1 212 850 5691

 

Sindan
Sindan Group at sindan@sindan.com
 
Forward looking statements
This press release contains forward-looking statements with respect to the financial condition, results of operations and businesses of Actavis.  By their nature, forward-looking statements and forecasts involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future.  There are a number of factors that could cause actual results and developments to differ materially from that expressed or implied by these forward-looking statements.  These factors include, among other things, exchange rate fluctuations, the risk that research and development will not yield new products that achieve commercial success, the impact of competition, price controls and price reductions, the risk of loss or expiration of patents or trade marks, difficulties of obtaining and maintaining governmental approvals for products, the risk of substantial product liability claims and exposure to environmental liability.