|By PR Newswire||
|April 22, 2014 01:00 AM EDT||
INDIANAPOLIS, April 22, 2014 /PRNewswire/ -- Eli Lilly and Company (NYSE: LLY) today announced an agreement to acquire Novartis Animal Health for approximately $5.4 billion in an all-cash transaction that will strengthen and diversify Lilly's own animal health business, Elanco. Upon completion of the acquisition, Elanco will be the second-largest animal health company in terms of global revenue, will solidify its number two ranking in the U.S., and improve its position in Europe and the rest of the world.
With a presence in approximately 40 countries and 2013 revenue of approximately $1.1 billion, Novartis Animal Health is focused on developing better ways to prevent and treat diseases in pets, farm animals and farmed fish. Lilly will acquire Novartis Animal Health's nine manufacturing sites, six dedicated research and development facilities, a global commercial infrastructure with a portfolio of approximately 600 products, a robust pipeline with more than 40 projects in development, and an experienced team of more than 3,000 employees.
Under the terms of the agreement, Lilly will acquire all assets of Novartis Animal Health for a total purchase price of approximately $5.4 billion, including anticipated tax benefits. Lilly plans to fund this acquisition with approximately $3.4 billion of cash-on-hand and $2.0 billion in debt to be issued. No other financial terms of the transaction are being disclosed. The transaction is expected to close by the end of the first quarter of 2015, subject to clearance under the Hart-Scott-Rodino Antitrust Improvements Act, similar requirements outside the U.S., and other customary closing conditions. The transaction is not subject to any financing conditions.
By improving efficiencies and reducing costs across both Elanco and Novartis Animal Health, Lilly expects to achieve estimated cost savings of approximately $200 million per year within three years of deal closing, equating to more than 10 percent of operating expenses from the combined animal health businesses. Excluding the amortization of intangibles, Lilly expects the combined entity to achieve EBIT as a percent of revenue in the mid-20 percent range by 2018. The company expects the transaction to be accretive to earnings on a cash basis beginning in 2016, excluding integration costs. The timing of accretion on a GAAP basis is dependent upon final purchase accounting. The acquisition is not expected to change the company's dividend policy or current share repurchase program.
John C. Lechleiter, Ph.D., Lilly's chairman, president and chief executive officer said that the acquisition of Novartis Animal Health validates Lilly's commitment to Elanco as a key component of Lilly's business going forward.
"Animal health continues to represent an attractive growth opportunity for Lilly. We intend to keep Elanco and to take advantage of the substantial synergies between our animal health and human health businesses," noted Lechleiter. "Significant investments in our animal health business in recent years have enabled Elanco to double its revenue since 2008, leading the industry in growth. Global trends suggest continued sustained demand for animal health products in the years ahead. Through this acquisition, which moves Elanco to top-tier in the industry, we intend to create value for our shareholders by adding to our promising pipeline of innovative animal health assets, increasing sales through a larger commercial footprint, and improving efficiencies and lowering costs."
Benefits of the Transaction
The acquisition will greatly expand and complement Elanco's product portfolio, R&D and manufacturing capabilities, and commercial presence in key geographies. In particular, it provides Elanco with a greater commercial presence in the companion animal and swine markets, expands Elanco's presence in the equine and vaccines areas, and creates an entry into the aquaculture market.
"This deal creates a global animal health leader able to deliver even more innovation and value to our customers," said Jeff Simmons, senior vice president of Eli Lilly and Company and president of Elanco Animal Health. "Combining these two great companies will enable us to provide more diversified brands, reach more market segments, expand our global footprint, and strengthen our pipeline, capabilities and expertise. Best of all, it will enable Elanco to better fulfill our important mission of enriching people's lives through safe, nutritious, affordable food and healthier pets. And that directly supports Lilly's mission to make life better for people around the world."
"Lilly emerged from our competitive process as the clear best buyer for Novartis Animal Health and a good home for our employees," said Joseph Jimenez, CEO of Novartis. "We look forward to a smooth transition of the business over the next several quarters."
BofA Merrill Lynch is acting as financial advisor to Lilly and Weil, Gotshal & Manges LLP is acting as legal counsel to Lilly. Goldman Sachs is acting as financial advisor to Novartis and Freshfields Bruckhaus Deringer is acting as Novartis' legal counsel.
Conference Call and Webcast
Lilly will conduct a conference call with the investment community and media today at 10:15 a.m. EDT to discuss today's announcement. Investors, media and the general public can access a live webcast of the conference call through a link that will be posted on the investor section of Lilly's website at www.lilly.com. The webcast of the conference call will be available for replay via the website.
About Novartis Animal Health
The innovative, high-quality medicines of Novartis Animal Health contribute to the quality of life, health and welfare of animals around the world. For pets, their products are effective aids to treat some internal and external parasites, prevent heartworm and flea infestations and treat ailments such as arthritic pain and kidney, heart and allergic diseases. For farm animals, they offer therapeutic products to treat parasitic and bacterial diseases and are also continually developing new vaccines to prevent diseases in livestock and farmed fish. Specific needs of food producers in the area of farm bioprotection are met by providing innovative fly control products and services.
Elanco is a global, innovation-driven company that develops and markets products and services to improve animal health and protein production in more than 75 countries. Elanco employs more than 3,000 people worldwide, with offices in more than 40 countries, and is a division of Eli Lilly and Company, a leading global pharmaceutical corporation. Additional information about Elanco is available at www.elanco.com.
About Eli Lilly and Company
Lilly is a global healthcare leader that unites caring with discovery to make life better for people around the world. We were founded more than a century ago by a man committed to creating high-quality medicines that meet real needs, and today we remain true to that mission in all our work. Across the globe, Lilly employees work to discover and bring life-changing medicines to those who need them, improve the understanding and management of disease, and give back to communities through philanthropy and volunteerism. To learn more about Lilly, please visit us at www.lilly.com and http://newsroom.lilly.com/social-channels. C-LLY
This press release contains forward-looking statements about the benefits of the acquisition of Novartis Animal Health and the potential of the combined businesses. This release reflects Lilly's current beliefs, assuming that the transaction is successfully closed; however, as with any such undertaking, there are substantial risks and uncertainties in the process of implementing the transaction and in the commercialization of these products. The company cannot guarantee that the transaction will successfully close, or that the company will achieve the expected benefits of the transaction. There is no guarantee that the commercial assets acquired will continue to be commercially successful, or that any acquired pipeline assets will yield commercially successful products. For further discussion of these and other risks and uncertainties, please see Lilly's latest Forms 10-K and 10-Q filed with the U.S. Securities and Exchange Commission. The company undertakes no duty to update forward-looking statements.
Refer to: (317) 276-5795 – Mark E. Taylor (Media - Lilly)
(317) 276-4076 – Colleen Parr Dekker (Media - Elanco)
(317) 655-6874 – Philip Johnson (Investors)
SOURCE Eli Lilly and Company
JFrog has announced a powerful technology for managing software packages from development into production. JFrog Artifactory 4 represents disruptive innovation in its groundbreaking ability to help development and DevOps teams deliver increasingly complex solutions on ever-shorter deadlines across multiple platforms JFrog Artifactory 4 establishes a new category – the Universal Artifact Repository – that reflects JFrog's unique commitment to enable faster software releases through the first pla...
Oct. 10, 2015 04:30 PM EDT Reads: 645
Today’s connected world is moving from devices towards things, what this means is that by using increasingly low cost sensors embedded in devices we can create many new use cases. These span across use cases in cities, vehicles, home, offices, factories, retail environments, worksites, health, logistics, and health. These use cases rely on ubiquitous connectivity and generate massive amounts of data at scale. These technologies enable new business opportunities, ways to optimize and automate, al...
Oct. 10, 2015 04:00 PM EDT Reads: 205
Mobile, social, Big Data, and cloud have fundamentally changed the way we live. “Anytime, anywhere” access to data and information is no longer a luxury; it’s a requirement, in both our personal and professional lives. For IT organizations, this means pressure has never been greater to deliver meaningful services to the business and customers.
Oct. 10, 2015 04:00 PM EDT Reads: 391
Saviynt Inc. has announced the availability of the next release of Saviynt for AWS. The comprehensive security and compliance solution provides a Command-and-Control center to gain visibility into risks in AWS, enforce real-time protection of critical workloads as well as data and automate access life-cycle governance. The solution enables AWS customers to meet their compliance mandates such as ITAR, SOX, PCI, etc. by including an extensive risk and controls library to detect known threats and b...
Oct. 10, 2015 03:00 PM EDT Reads: 265
Chris Van Tuin, Chief Technologist for the Western US at Red Hat, has over 20 years of experience in IT and Software. Since joining Red Hat in 2005, he has been architecting solutions for strategic customers and partners with a focus on emerging technologies including IaaS, PaaS, and DevOps. He started his career at Intel in IT and Managed Hosting followed by leadership roles in services and sales engineering at Loudcloud and Linux startups.
Oct. 10, 2015 03:00 PM EDT Reads: 260
Recently announced Azure Data Lake addresses the big data 3V challenges; volume, velocity and variety. It is one more storage feature in addition to blobs and SQL Azure database. Azure Data Lake (should have been Azure Data Ocean IMHO) is really omnipotent. Just look at the key capabilities of Azure Data Lake:
Oct. 10, 2015 02:00 PM EDT Reads: 355
As-a-service models offer huge opportunities, but also complicate security. It may seem that the easiest way to migrate to a new architectural model is to let others, experts in their field, do the work. This has given rise to many as-a-service models throughout the industry and across the entire technology stack, from software to infrastructure. While this has unlocked huge opportunities to accelerate the deployment of new capabilities or increase economic efficiencies within an organization, i...
Oct. 10, 2015 02:00 PM EDT Reads: 307
Electric power utilities face relentless pressure on their financial performance, and reducing distribution grid losses is one of the last untapped opportunities to meet their business goals. Combining IoT-enabled sensors and cloud-based data analytics, utilities now are able to find, quantify and reduce losses faster – and with a smaller IT footprint. Solutions exist using Internet-enabled sensors deployed temporarily at strategic locations within the distribution grid to measure actual line lo...
Oct. 10, 2015 02:00 PM EDT Reads: 170
For almost two decades, businesses have discovered great opportunities to engage with customers and even expand revenue through digital systems, including web and mobile applications. Yet, even now, the conversation between the business and the technologists that deliver these systems is strained, in large part due to misaligned objectives. In his session at DevOps Summit, James Urquhart, Senior Vice President of Performance Analytics at SOASTA, Inc., will discuss how measuring user outcomes –...
Oct. 10, 2015 02:00 PM EDT Reads: 505
The Internet of Everything is re-shaping technology trends–moving away from “request/response” architecture to an “always-on” Streaming Web where data is in constant motion and secure, reliable communication is an absolute necessity. As more and more THINGS go online, the challenges that developers will need to address will only increase exponentially. In his session at @ThingsExpo, Todd Greene, Founder & CEO of PubNub, will explore the current state of IoT connectivity and review key trends an...
Oct. 10, 2015 01:45 PM EDT Reads: 170
Docker is hot. However, as Docker container use spreads into more mature production pipelines, there can be issues about control of Docker images to ensure they are production-ready. Is a promotion-based model appropriate to control and track the flow of Docker images from development to production? In his session at DevOps Summit, Fred Simon, Co-founder and Chief Architect of JFrog, will demonstrate how to implement a promotion model for Docker images using a binary repository, and then show h...
Oct. 10, 2015 01:00 PM EDT Reads: 246
SYS-CON Events announced today that IBM Cloud Data Services has been named “Bronze Sponsor” of SYS-CON's 17th Cloud Expo, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. IBM Cloud Data Services offers a portfolio of integrated, best-of-breed cloud data services for developers focused on mobile computing and analytics use cases.
Oct. 10, 2015 01:00 PM EDT Reads: 759
As the world moves towards more DevOps and microservices, application deployment to the cloud ought to become a lot simpler. The microservices architecture, which is the basis of many new age distributed systems such as OpenStack, NetFlix and so on, is at the heart of Cloud Foundry - a complete developer-oriented Platform as a Service (PaaS) that is IaaS agnostic and supports vCloud, OpenStack and AWS. In his session at 17th Cloud Expo, Raghavan "Rags" Srinivas, an Architect/Developer Evangeli...
Oct. 10, 2015 01:00 PM EDT Reads: 222
The Internet of Things (IoT) is growing rapidly by extending current technologies, products and networks. By 2020, Cisco estimates there will be 50 billion connected devices. Gartner has forecast revenues of over $300 billion, just to IoT suppliers. Now is the time to figure out how you’ll make money – not just create innovative products. With hundreds of new products and companies jumping into the IoT fray every month, there’s no shortage of innovation. Despite this, McKinsey/VisionMobile data...
Oct. 10, 2015 01:00 PM EDT Reads: 274
Today air travel is a minefield of delays, hassles and customer disappointment. Airlines struggle to revitalize the experience. GE and M2Mi will demonstrate practical examples of how IoT solutions are helping airlines bring back personalization, reduce trip time and improve reliability. In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect with GE, and Dr. Sarah Cooper, M2Mi's VP Business Development and Engineering, will explore the IoT cloud-based platform technologies driv...
Oct. 10, 2015 01:00 PM EDT Reads: 169