FIMI Opportunity Funds, headed by Ishay Davidi, has completed the acquisition of the Migada plant in Kiryat Shmona from Teva Pharmaceutical Industries for $47.5 million, and has announced the appointment of managers for it. The acquired plant was a business unit in Teva named Tevadaptor that produced a closed system for protecting medical teams against exposure to hazardous materials when preparing oncological drugs and treating oncological patients. Teva put the plant up for sale in late 2017 in the framework of its major streamlining plan. The negotiations between Teva and FIMI were reported exclusively in "Globes" in January.
Ori Yehudai, former CEO of flavors and spices company Frutarom, sold for $6.5 billion last year, will join Tevadaptor as chairman. Oded Grinstein, who managed the business unit in recent years, was appointed CEO, and David Delouya was appointed CFO.
"We are delighted to acquire the Tevadaptor group, a global leader in the development, production, and marketing of special medical equipment for protecting medical staff from exposure to hazardous materials when preparing drugs and treating patients," Yehudai said today. "We will strengthen and enhance research and development to take maximum advantage of the group's growth potential with a combination of profitable accelerated internal growth and strategic acquisitions. The know-how and experience of FIMI and me in upgrading companies, extending broad global deployment, and accelerating growth will greatly contribute to the success of the company and its management, which will be reinforced."
Grinstein said, "The Tevadaptor group operated for years, and attained considerable achievements in its field of business. What is special about the plant's business team and management, led by Itsik Shmueli, is a winning combination of quality and uncompromising professionalism, with extraordinary motivation and zeal." Grinstein added that the entry of FIMI and the recruitment of Yehudai were an important vote of confidence in the team, production lines, and unique technologies developed in the company, and in the planned lines of growth.
Tevadaptor, founded in 2005, currently has 200 employees. Its activity is profitable, and its EBITDA is believed to be in the 15-20% range. Because it was profitable, Teva looked for a buyer for the plant, and was in no hurry to close it down, as it did elsewhere, such as in Jerusalem and Ashdod. Teva first held an auction to sell the plant, in which FIMI did not participate. When the tender was called off, exclusive negotiations between Teva and FIMI began, while a collective labor agreement was signed with the employees, who had earlier declared a work dispute, due to uncertainty before the deal. The agreement states that the employees will receive bonuses of up to NIS 60,000 per employee, depending on seniority, when the plant is sold.
Teva's streamlining plan was designed to enable the company to save $3 billion in costs in order to ensure the company's ability to service its debt, which amounted to $28.9 billion at the end of 2018 ($27.1 billion in net debt). The company will tomorrow publish its report for the first quarter of 2019. The market is looking to see whether the amount of debt will continue falling, and by how much, and about progress in the streamlining plan. At the same time, investors will be interested in the progress of market penetration by Teva's Ajovy anti-migraine drug. Teva's market cap is $16.6 billion.
Published by Globes, Israel business news - en.globes.co.il - on May 1, 2019
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