Connect to share and comment
* Lazard's Brazilian arm hired to investigate sale
* Ache ranks as market leader in prescription drugs
* Differing views among owners mean sale uncertain
By Ben Hirschler and Sophie Sassard
Feb 7 (Reuters) - International drug companies are considering bidding for Ache Laboratorios Farmaceuticos, one of Brazil's biggest drugmakers, in a deal valuing it at several billion dollars, according to people involved in the process.
Buying privately owned Ache could appeal to a number of drug firms looking to increase their footprint in Latin America - a region firmly on the radar screen of pharmaceutical groups hunting new markets as sales in Western countries sputter.
Sources said the Brazilian arm of investment bank Lazard had been mandated by key shareholders to investigate a sale of Ache - and several European and U.S. drugmakers had shown interest.
Whether a sale will be concluded is unclear, however, given divisions among the three family groups that control the company, with two more willing to sell than the third.
Ache's future was put further in the balance by the resignation on Wednesday of CEO Jose Ricardo Mendes da Silva. A company spokesman said he was leaving for personal reasons and an acting managing committee would now run the company.
The Ache spokesman declined to comment on whether the group would be sold, while officials at Lazard in London said they could not comment on the bank's role in the process.
Ache is a valuable prize in a fast-growing market and its sale would build on a number of deals in the Brazilian sector in recent years, including Sanofi's purchase of generic drugmaker Medley for 500 million euros ($670 million) in 2009.
Sanofi paid 3.3 times historic sales for Medley. A similar multiple for Ache, which has sales of around $750 million a year, would give a price of $2.5 billion.
In practice, Ache's owners will be hoping for a lot more than that, reflecting Ache's much lower reliance on generic drugs, where margins have been seriously squeezed, and the higher demand for Latin American assets today than four years ago.
It was not clear which companies were looking at Ache but big emerging markets like Brazil are a major focus for many leading pharmaceutical players, such as Pfizer, GlaxoSmithKline and Novartis.
Although it ranks fourth in terms of overall Brazilian drugs sales, Ache is the market leader in prescription medicines and has a track record of producing its own branded products.
In 2005, it developed the anti-inflammatory drug Acheflan from a native plant - the first medicine to be researched and developed entirely in Brazil.
It is also active in the fast-growing over-the-counter (OTC) healthcare market.
Ache's exposure to cut-price generics is relatively limited, according to a report last month by Fitch Ratings, which forecast that its generic drug portfolio would not account for more than 10 to 15 percent of future revenue.
Fitch said Ache's business position was "strengthening" and its profit margins were "strong and stable".
Revenue in the 12 months to Sept. 30. 2012 was 1.5 billion reais ($750 million), generating earnings before interest, tax, depreciation and amortisation (EBITDA) of 540 million, Fitch said.
Ache has a staff of 3,300, including more than 1,600 sales representatives, and it has also been expanding overseas, with contracts to export 40 drugs to 12 different countries.