Ohio-based Cardinal Health (CAH) has agreed to buy Michigan-headquartered The Harvard Drug Group (THDG) for $1.12 billion. According to press releases, THDG, which is currently owned by Court Square Capital Partners, is a distributor of generic pharmaceuticals and over-the-counter medications to retail and institutional customers. The deal is expected to close in the beginning of fiscal year 2016 and will be paid for using existing cash and new debt.
Cardinal Health predicts the acquisition will enhance Cardinal’s generic pharmaceutical distribution and enable specialized packaging offerings to meet the needs of hospital systems and other institutions. Cardinal Health chairman and chief executive officer George Barrett said:
” The Harvard Drug Group aligns perfectly with our commitment to provide the most comprehensive line of pharmaceutical products for the broadest range of customers… This acquisition enhances our ability to support retail and institutional customers and further utilizes Red Oak, our joint venture with CVS Health to source generics…”
According to the press release, the deal includes THDG’s 450 employees and two distribution facilities. THDG had revenues of approximately $450 million in 2014. Cardinal Health projects the acquisition will add 15 cents to Cardinal’s earnings per share in fiscal year 2016.