PHILAB Holdings Corp. is acquiring an approximately 67% stake in local pharmaceutical firm Sydenham Laboratories, Inc. (SLI) for P390.6 million.
In a disclosure to the stock exchange on Tuesday, Philab said its board of directors has approved the purchase of 625,000 secondary common shares in SLI, representing 33.33% of its resulting outstanding capital stock, at P46.62 each from various SLI shareholders.
Philab will also subscribe to 625,000 primary common shares from the unissued capital stock of SLI, also representing 33.33% of the latter’s outstanding capital stock, at P46.62 each.
The total consideration for the SLI shares is at P390.6 million.
In turn, Philab will issue up to 48.828 million common shares at P4 each out of its unissued authorized capital stock to SLI, as well as shareholders who will be selling SLI secondary shares.
The listed firm will pay P137.01 million of the purchase price in cash, while the remaining balance will be offset by the Philab shares it will be issuing to SLI.
The subscription price for the Philab shares will have to be confirmed by the Securities and Exchange Commission, where the company will be filing an application for confirmation of valuation.
Once the SEC confirms the valuation, Philab will execute definitive agreements for the deal before closing.
Philab had announced its acquisition of a majority stake in SLI last December 2017, which it expects would boost its product offerings.
SLI manufactures hormone-based drugs and specializes in oral drug preparation in dosage forms. The company has more than 300 certificates of product registration focused on the central nervous system, endocrine system, and cardiovascular system, among others, over 40 years of operations.
Earlier this year, Philab has also struck a partnership with United States-based Veritas Genetics, injecting an initial P500 million to build the company’s facility in Clark, Pampanga.
This year, Philab has committed to spend $150 million to fund the construction of up to 60 satellite clinics across the Philippines. The clinics aim to serve the primary care needs of patients unable to immediately reach hospitals. The spending will also cover the company’s further investments in genetics.
Philab recorded a net loss of P107.85 million in the first nine months of 2017, higher than its net loss of P860,006 in the same period in 2016, against revenues of P155.15 million.
Shares in Philab gained 16 centavos or 4.83% to close at P3.47 each at the stock exchange on Tuesday. — Arra B. Francia
