GERMANY - 3i sells German betapharm to Dr Reddy’s Labs

The transaction volume is EUR 480m. The sale also includes the not for profit beta institute.

Founded in 1993, betapharm is the fourth-largest generics company in Germany with a market share of about 3.5%. betapharm markets high-quality generic drugs focusing on long-term therapy products with high prescription rates. betapharm is the fastest growing generics company over the past five years in the top 10 in Germany with a track record of successful product launches. betapharm’s current portfolio comprises around 145 active ingredients in the market. Located in Augsburg, Germany, betapharm currently employs approximately 370 people including a sales force of about 250.

3i invested in betapharm in March 2004. Since then 3i has been active in helping the company develop its business activities, particularly in product sourcing. 3i also introduced Thomas Nedtwig as a Chief Financial Officer and managed the succession of Dr. Wolfgang Niedermaier as CEO when Peter Walter retired.

Bernie Schuler, a partner in 3i’s European buyouts business based in Frankfurt, has led this transaction. Commenting on today’s sale, he says: '3i has worked closely with management in the past two years to position the business for international growth and expansion. Today’s sale to Dr Reddy’s is an exciting logical step for betapharm’s next phase of development. Dr. Reddy’s broader product range and high quality production base at competitive cost levels will enable the business to grow exponentially.'

The buyer, Dr Reddy’s Laboratories Limited, established in 1984, is an emerging global pharmaceutical company with proven research capabilities. The company is vertically integrated with a presence across the pharmaceutical value chain. It produces generic finished dosage forms, active pharmaceutical ingredients and biotechnology products and markets them globally, with a focus on India, U.S.A, Europe and Russia. Dr. Reddy’s employs over 6,500 people globally with headquarters in Hyderabad, India.

Dr Wolfgang Niedermaier, CEO of betapharm comments: 'Dr Reddy`s impressive pipeline of generic and innovative products and its high quality standards combined with competitive manufacturing costs will help further develop our position in the German market and offer an entry platform for the European market.'

Bear, Stearns International Limited, New York, and Sal.Oppenheim, Frankfurt, acted as financial advisers to 3i on this transaction and Clifford Chance, Frankfurt, acted as external legal counsel for 3i. Rothschild, London, acted as financial advisers and Freshfields Bruckhaus Deringer, Munich, acted as external legal counsel to Dr Reddy’s in this transaction.

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