Johannesburg – Ascendis Health has concluded a sale agreement of its pharmaceutical manufacturing facility in Isando, Gauteng, to Mylan, one of the world’s leading pharmaceutical companies, for R130 million.
The contemplated sale forms part of Ascendis Health’s non-core asset disposal programme announced earlier this year following management’s strategic business review.
Chief executive officer Thomas Thomsen said: “After an extensive evaluation of our pharmaceutical manufacturing requirements we decided to sell the Isando plant owing to its low utilisation and to reduce the complexity of our South African pharmaceutical operations.”
The 28 000 m² plant was acquired through Ascendis Health’s purchase of Akacia Healthcare in 2015. The facility includes capsules, oral solids and semi-solids manufacturing and packaging as well as a quality control laboratory with a stability centre used to conduct physiochemical and microbiological tests for pharmaceuticals and complementary and alternative medicines.
Following the sale of the Isando plant Ascendis Health will be consolidating its pharmaceutical manufacturing into its facility in Wynberg, Gauteng.
Thomsen said the cash proceeds from the sale will be applied mainly to reduce gearing levels and to fund the working capital requirements of the business. Part of the proceeds will be invested in upgrading the company’s supply chain, he said.
Mylan Pty Ltd, a wholly owned subsidiary of Mylan, is a supplier of ARV and other oral solids to the national Department of Health (DoH). Mylan plans to manufacture ARV medicines and other oral tablets in the facility to supply the DoH. Ascendis Health has concluded a manufacturing and supply agreement with Mylan to continue producing the products currently being manufactured at the Isando factory.
The transaction is subject to approval by the Competition Commission.
Ascendis Health previously announced the sale of its South African sports nutrition business for R54 million and its direct selling and network marketing business for R40 million. The group’s bioscience business, comprising Avima/Klub 5, Efekto, Marltons and Afrikelp, has also been identified for disposal as it is considered non-core to the group’s new strategy which will focus primarily on the pharma and consumer healthcare sectors.
Issued by Tier 1 Investor Relations on behalf of Ascendis Health
For further information kindly contact
Graeme Lillie, Tier 1 Investor Relations 082 468 1507