The €32.2 million (£26.7 million) deal will be funded by debt from Hayfin Capital Management and compliments Sinclair’s Sculptra & Kelo-Cote aesthetic brand which will benefit from marketing synergies. The deal is expected to boost its sales mainly in Asia, Brazil and Russia.
The announcement has led stockbroker Investec to improve its 2015 earnings before interest, tax, depreciation and amortisation (EBITDA) forecast by 29.6% to £15.3 million. It raises the 2016 EBITDA target by 32.1% to £17.6 million.
‘Not only does the acquisition unlock the operational leverage potential of Sinclair’s EU infrastructure at a good price, we think it also potentially makes the company a more attractive acquisition target for those wanting to build a presence within the aesthetic dermal market,’ says Investec in a research note.
The deal is part of Sinclair’s plans to sell fewer brands in global markets. When the deal closes by the end of February, aesthetic dermatology will account for a third of Sinclair IS Pharma’s revenues, lowering the government-controlled pricing impact on its business to less than a third of its portfolio.