Bausch Health Companies Inc, along with certain affiliates, has agreed to sell its stake in Amoun Pharmaceuticals to Abu-Dhabi based ADQ for a total consideration of $740 million.
Bausch Health (BHC) Chairman and CEO, Joseph C. Papa said, “The sale of Amoun marks significant progress in our efforts to reduce overall Bausch health debt as we continue to pursue all opportunities to drive value for our shareholders, including preparing for the spinoff of Bausch + Lomb.”
Amoun Pharmaceuticals provides branded generics of human and animal health products in Egypt. Bausch expects the transaction to close in 1H 2021, subject to closing conditions and approvals. (See Bausch Health stock analysis on TipRanks)
This also includes a mandatory tender offer (MTO) that needs to be launched by ADQ and approved by the Financial Regulatory Authority in Egypt. Bausch and its affiliates will tender their shares in the MTO at EGP 37.806 per share.
On April 1, H. C. Wainwright analyst Ram Selvaraju reiterated a Buy rating on the stock with a price target of $55 (73.4% upside potential).
Commenting on the Amoun sale, Selvaraju said, “Investors may recall that ADQ’s interest in Amoun had been documented dating back to at least October 2020. Cash generated by Amoun from the start of 2021 to the closing of the deal-slated to occur in 1H 2021-is to accrue to the buyer and will not be reported as part of Bausch health’s financial results for the year.”
Turning to rest of the Street, the stock has a Moderate Buy consensus rating alongside an average analyst price target of $34.54 (8.9% upside potential) based on 8 Buys, 4 Holds and 1 Sell. Shares have gained about 130.6% over the past year.
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