#Reckitt Benckiser#Bristol-Myers Squibb#Latin America#heal#Latin America

RB & BMS Collaborate To Expand Into Latin America

Reckitt Benckiser Group today announced that it has signed a three year collaboration agreement with Bristol-Myers Squibb for a number of market-leadi...

Admin
|Feb 20|magazine6 min read

 

Reckitt Benckiser Group today announced that it has signed a three year collaboration agreement with Bristol-Myers Squibb for a number of market-leading over-the-counter consumer health care brands in Brazil, Mexico and certain other parts of Latin America, with an option to purchase at the end of the three year period.

The key brands included under the agreement are Naldecon, Luftal and Dermodex in Brazil and Tempra, Picot and Graneodin in Mexico. As part of the collaboration, RB will licence the brands from BMS, who will continue to manufacture them for three years. 

Rakesh Kapoor, Reckitt Benckiser Chief Executive Officer, said, “This transaction creates a material consumer health care platform, infrastructure and distribution network for RB in both Brazil and Mexico. As such it is an important step in building our consumer health care presence in Latin American emerging markets. 

“These market-leading brands have strong margins and I firmly believe they have extremely good growth potential. They fit into our existing OTC (over-the-counter) categories of pain relief, sore throat, cough and cold, anti-acid, and dermatological and will benefit from RB’s consumer marketing and innovation capabilities, and our significant levels of brand equity investment.”


Under the terms of the agreement RB will initially pay BMS $482 million to enter into the arrangement which also includes personnel, supply contracts and an option to acquire legal title to the related intellectual property at the end of the collaboration period, based on business performance. The transaction will be accounted for as a business combination and the Directors are in the process of revaluing the assets and liabilities acquired to fair value, including the value of any acquired intangible assets. Under the terms of a separate supply agreement BMS will be RB’s supplier of the products during the collaboration period.

BMS Assets had unaudited reported net revenue for the year ended 31 December 2012 of $102 million.

The collaboration will come into effect following regulatory approvals, including anti-trust approvals in the relevant jurisdictions. This is expected to be completed in Q2 2013.