Swiss market expansion services group DKSH announced on Monday 19 October that its Healthcare division is acquiring Newbridge Pharmaceuticals, a Dubai-based distributor of specialty medicines. The price covers all shares and amounts to $390 million, according to the press release reported by the Keystone-ATS news agency and SWI swissinfo.ch.

What DKSH is buying with Newbridge

Founded in 2010, Newbridge markets medicines for rare and complex diseases. The company employs more than 300 people and operates in 14 markets across the Middle East and North Africa, the largest of which are Saudi Arabia and the United Arab Emirates. Its therapeutic areas include oncology, neurology, immunology and gastroenterology.

Newbridge does not limit itself to distribution: it also supports pharmaceutical companies in launching their products and in gaining market access. The current management team is to remain in place after the takeover.

Healthcare, the growth driver DKSH claims

In the press release, DKSH CEO Stefan Butz states that providing outsourced marketing services to pharmaceutical companies has been an important growth driver in recent years. With Newbridge, the group says it also wants to expand its business in medicines for rare diseases. This is a statement from management: figures for the Healthcare division are not included in the announcement.

For 2027, DKSH expects Newbridge to generate revenue of around $385 million and an EBITDA margin in the high single digits. These are forecasts, not reported results. Set against the price, these figures indicate that DKSH is paying roughly the equivalent of one year of expected sales. The group expects the deal to improve its revenue growth, adjusted EBIT margin and earnings per share as soon as it closes.

A first in the Middle East for the Healthcare division

According to the press release, the acquisition marks DKSH Healthcare's first move into the Middle East and North Africa. Until now, the division had focused on the Asia-Pacific region. The change is therefore primarily geographic: DKSH is applying to a new region a business it already practises, that of intermediary between pharmaceutical companies and local markets.

This model is part of a long family-business history. A swissinfo article published in February 2013 recalled that the Diethelm and Keller families had diluted their control of DKSH the previous year by listing the group on the stock exchange, ushering into a new phase what was then the largest private company in Switzerland.

Debt financing and timetable

The acquisition will be financed with debt. DKSH believes it will retain sufficient financial headroom for further acquisitions, and its current dividend policy is to remain unchanged. Two readings are possible: the additional debt weighs on the balance sheet, but the group presents it as compatible with pursuing its acquisition strategy. The announcement does not give the amount of total debt after the deal, which makes it impossible to measure its weight precisely.

Completion is expected by the end of the first quarter of 2027, subject to regulatory approvals. For Switzerland, the direct impact remains to be clarified: the announcement does not mention any effect on the group's jobs in the country. The deal mainly concerns the international footprint of a company listed in Switzerland.

Sources

  • SWI swissinfo.ch: “Swiss group DKSH expands into Middle East with major acquisition”