Absa’s Corporate and Investment Banking Division (Absa CIB) together with its global partners have raised R7.9 billion for Ascendis Health Limited, a South African based Healthcare Company. The proceeds were generated to acquire two European based businesses; Remedica Holdings, a pharmaceutical company based in Cyprus and Scitec International, a European sports nutrition company located in Hungary.
The total quantum raised represented over 100% of the Ascendis market capitalization, making it the largest acquisition-financing equity-raise on the JSE this year to date.
The purchase consideration of ZAR7.9 billion required both a debt and an equity capital raise and Ascendis consequently appointed Absa CIB to act as Joint Global Coordinator, Mandated Lead Arranger, Bookrunner, Underwriter, Financial Advisor, JSE transaction sponsor and Facility and Security Agent for the overall transaction.
Liza Eustace, Head of Healthcare Sector at Absa CIB says, “Supporting this transformational transaction for Ascendis is a clear demonstration of how we assist African companies to achieve their ambitions in the right way. By successfully implementing this deal, our client is now able to increase their presence in the European market, diversify their revenue streams and have access to international sales distribution platforms through which to channel existing products.”
“As a bank with a significant African footprint our Shared Growth strategy focuses on the responsibility to make a sustainable contribution to our clients and communities; to not only do well, but to do good by our clients. This in turn increases the prosperity of their entire ecosystem and drives mutual economic and social growth in communities they operate,” says Eustace.
Absa CIB was able to seamlessly interact with both local and offshore investors which ultimately led to a successful debt and equity capital raise. The debt package was split into multiple currencies across multiple jurisdictions through tranches of ZAR1.96bn and EUR204mn respectively.
The debt was successfully syndicated to 12 investors across South Africa and Europe, thus achieving a more diversified funding pool for Ascendis. The equity raise totalled ZAR2.7bn and was raised through a combination of a pre-emptive rights offer and a Vendor Consideration Placement.
Karsten Wellner, CEO of Ascendis Health Limited says, “This is extremely exciting as not only will we gain access to meaningful global platforms, brands and distribution synergies, but we will also inherit a world class staff complement of industry-leading professionals with knowledge and experience. This will benefit Ascendis in the long term and ultimately create value for our employees, clients and shareholders.”
Ascendis’s strategy is to complement growth in the domestic healthcare market through international expansion in selected geographies by acquiring platform businesses offshore that can be leveraged across the business’s existing product range. These acquisitions will be transformative for Ascendis and position them as an international healthcare business of scale and relevance with global reach.
Will Thompson, Head of Barclays Plc EMEA Healthcare Corporate Finance says, “This transaction highlights the success of the Barclays Group’s Investment Banking franchise in South Africa, as well as showcasing our position as top EMEA Healthcare Bank with strong momentum in the generic/specialty pharma space. We are proud to have been part of this deal as it will materially increase the company’s competitive edge through both an increased specialist product range as well as increasing its presence in the key European markets.”