Famy Care will spin off its female health care businesses as a de-merger, with Mylan acquiring the new company’s shares

Mylan has reached a definitive agreement to buy Famy Care Ltd’s female reproductive health care businesses for about $750 million in cash and $50 million in contingent payments to tap the large women’s health care market in Europe. Canonsburg, Penn.-based Mylan already has an exclusive partnership dating back to 2008 with Mumbai, India-based Famy Care.

Mylan To Buy Famy Care Women’s Health Units For $800M

Mylan – Famy Care acquisition: The details

As part of the agreement, Famy Care will spin off its female health care businesses under a court-approved scheme of a de-merger, with Mylan acquiring the shares of the new company. The deal will also add Famy Care’s leading hormonal contraceptives business and make it a leader in high-growth emerging markets around the world.

The deal has been unanimously approved by both companies’ boards of directors. The deal envisages Mylan paying an additional payment of up to $50 million, which is contingent upon achievement of certain development and regulatory milestones. The deal is expected to close in the second half of 2015 and is subject to regulatory approvals and certain closing conditions. The deal is expected to immediately add to Mylan’s adjusted earnings per share upon closing.

Under Famy Care’s years-long partnership with Mylan, it develops and supplies OCP products to Mylan for distribution to customers in the U.S. and certain other markets. Both companies have a portfolio of 12 approved products in the U.S., with abbreviated new drug applications pending FDA approval for 30 products.

Exuding confidence over the new deal, J.P. Taparia, non-executive chairman of Famy Care said: “In 2010, we started the process of transitioning from a family-owned business into a meaningful institutional player in the global pharmaceutical industry by enlarging our shareholder base with the investment by pan-Asian private equity firm, AIF Capital Limited. Their involvement and support for Famy Care have been very helpful in the company’s achievement of critical corporate milestones over the last four years. Shareholders of Famy Care will evaluate and pursue other opportunities in the residual Famy Care business outside of women’s health care segment.”

The deal will complement Abbott’s acquisition

Mylan pointed out that the new deal with Famy Care will complement its pending $5.3 billion acquisition of Abbott’s branded generics pharmaceuticals business in developed markets, which also includes a women’s health care portfolio and sales and marketing capabilities.

Mylan announcement Monday marks its second deal with an Indian drugmaker after it bought Bangalore-based Strides Arcolab’s injectable drugs unit for $1.6 billion in 2013. In recent years, U.S.-based pharmaceutical giants have been trying to woo drugmakers in fast-growing emerging markets to reap the benefits of cheaper production facilities.