* Cardinal to buy Futuremed for C$165 mln
* Deal represents a premium of 31.5 pct to Futuremed's
* Futuremed shares touch offer price in early trade
Oct 25 U.S. drug wholesaler Cardinal Health
Inc's Canadian unit agreed to buy Futuremed Healthcare
Products for about C$165 million in cash, to boost its
presence in the country.
Since last year, Cardinal and McKesson Corp , two of
the three largest U.S. drug wholesalers, have been aggressive
acquirers as they look to expand their existing product line in
different geographies and boost their share of specialty care.
Last year, Cardinal bought Zuellig Pharma China for $470
million and Kinray Inc for $1.3 billion, while McKesson Corp
acquired privately held Oncology Inc for $2.16
billion, including debt.
The deal values Futuremed at C$8.15 a share, a premium of
31.5 percent to the stock's Monday's close.
Shares of Futuremed, which touched the offer price earlier,
were trading at C$8.08 on Tuesday on the Toronto Stock Exchange
-- indicating investors were not expecting a higher bid.
The transaction is valued "roughly around 11 times price to
cash flow ... a reasonable valuation," said National Bank's
analyst Trevor Johnson.
Futuremed distributes nursing home supplies and specialized
furniture and equipment to the growing long-term care facilities
sector like the U.S. company's Canadian unit.
"This is a natural extension for their distribution
channel," Johnson said.
Futuremed recommended stockholders tender their shares to
Cardinal Health's offer, while senior officers and directors of
the company with a 5 percent stake have already agreed to do so.
Shares of Cardinal Health were down just over half a percent
at $43.77 on the New York Stock Exchange.