Drug distributor NeoPharm Medical Supplies Ltd., owned by the Fuhrer and Sarel families, is buying its competitor Promedico Ltd., owned by Benjamin and Michael Jesselson.
“Globes” reported about merger or acquisition negotiations in November 2004, which were denied by NeoPharm CEO David Fuhrer and Promedico CEO Benjamin Jesselson. They told “Globes” that no contact had ever taken place between the two companies.
David Forer will manage the merged company, and Benjamin Jesselson will serve as a consultant until the merger is completed. The merger is designed to strengthen both companies’ distribution networks and create economies of scale. It is not yet clear how of Promedico’s 350 employees will be fired, and how many will join NeoPharm’s 200 employees.
NeoPharm and Promedico decided to merge after Promedico’s owners examined the possibility of bringing a partner into the company. Negotiations ebbed and flowed over disagreements on the value of the companies, until finally agreement was reached. The Jesselsons will reportedly get tens of millions of dollars for Promedico. NeoPharm’s turnover last year was $80-100 million. The combined company will have a sales turnover of NIS 1 billion.
NeoPharm distributes ethical drugs, and leading brands of non-prescription drugs and other medical equipments. It was founded in 1941 by Dr. Goldschmidt, the father-in-law of current chairman Zvi Sarel. Sarel’s son-in-law David Fuhrer has been CEO since 1980. NeoPharm tripled its turnover over the past decade, and states that it now controls of 7% of the Israeli drug distribution market.
Promedico’s owners Benjamin and Michael Jesselson were formerly among the controlling shareholders in Elite. Promedico imports the products of baby food manufacturer Similac, and markets dialysis products, inoculations, and solutions manufactured at its plant in Migdal Ha’emek founded four years ago with Clalit Health Services.
Published by Globes [online], Israel business news - www.globes.co.il - on September 7, 2005