CSL snaps up Talecris for $3.1bn

By Phil Taylor

- Last updated on GMT

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Australia’s CSL Ltd has signed a $3.1bn agreement to acquire Talecris Biotherapeutics of the US and throw down the gauntlet to rival Baxter International in the plasma-based pharmaceutical sector.

Like CSL, Talecris operates a network of plasma collection services that provides the source material for plasma-based products such as immunoglobulins, and is also selling and developing a range of plasma-based therapeutic products.

CSL has sales of A$3.8bn a year ($3.3bn), while Talecris reported 2007 sales of $1.2bn. Putting the two companies’ together will create a combined plasma unit with sales of around $3.3bn, a sizeable jump but still well shy of Baxter’s $4.65bn plasma business. The total world market for plasma products is estimated at $15bn.

CSL’s chief executive Brian McNamee said that buying Telecris would give CSL additional scale, a greater breadth of products, a wider geographical presence and a lower cost base, as well as the capacity to increase output.

"It will enhance our position in the global plasma products market and will make CSL a stronger competitor in the highly competitive plasma therapeutics marketplace​," he added.

The agreement will also see the handover of Talecris’ 100,000 sq. ft. contract manufacturing unit in Melville, New York, which provides aseptic filling and product manufacturing ranging from plasma fractionation to pharmaceutical compounding to separation, extraction, concentration and purification of complex molecules. It also offer analytical and microbial quality control services.

CSL will raise $1.5bn in a share sale to help fund the purchase of Talecris from private equity firms Cerberus Partners and Ampersand Ventures, and will fund the remainder of the deal with cash and a loan from Merrill Lynch. Cerberus and Ampersand created Talecris in 2005 after buying up Bayer’s plasma products business for around $300m.

CSL has a history of buying scale in the plasma sector, having snapped up Swiss producer ZLB for $525m in 2000, and Aventis’ Behring business in 2004 for around $1.3bn.

The Australian firm has been looking for an opportunity to tap into the huge US market which has a high regulatory barrier for entry. Buying Talecris with its network of collection centres bypasses that hurdle.

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