AMRI expects to make layoffs during Euticals integration

By Gareth Macdonald

- Last updated on GMT


Related tags U.s. securities and exchange commission

AMRI has said integrating recent Italian acquisition Prime European Therapeuticals, also known as Euticals, will involve layoffs.

The US contractor shared some details of its plan in a Securities and Exchange Commission (SEC) filing on August 29​, explaining it expects to incur costs of between $5.7m and $7.3m related to “a reduction in force and other transition activities​.”

It said: “This includes non-cash fixed asset impairment charges of approximately $0.06m relating to the closure of a Euticals site and non-cash share-based compensation modification charges of approximately $0.16m.

Cash charges will consist of $5.5 - $7.1m of employee and other related costs and will primarily be paid during the second half of 2016​.”

AMRI bought Euticals in July for €315m ($350m) in a deal that added five manufacturing facilities in Italy, two in France, one in Germany and one in the US to its network.

Lodi, Italy –headquartered Euticals claims to have a 400-strong customer base of pharmaceutical and biotechnology industry clients.

API investments

AMRI announced plans for the acquisition in May​.

At the time US ratings agency Standard and Poor’s (S&P) said: “AMRI's acquisition of Euticals is accretive to the company's scale, geographic diversity and customer base​” and reaffirmed its rating of the firm as “stable.”

S&P also predicted that Euticals would be AMRI's last major takeover for the next year.

"We do not expect another large acquisition in the next year, given the company's required integration of two sizable and several tuck-in acquisitions since 2014​."

Euticals is the second active pharmaceutical ingredient firm AMRI has bought in a year.

Last July​ the US firm acquired Spain-based Gadea Pharmaceutical Group for $174m in a deal that included the latter’s steroid precursor division Bioraw and its finished dosage unit, Crystal Pharma.

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