NEW YORK (AP) - Prestige Brands Holdings Inc. will pay British drugmaker GlaxoSmithKline PLC $660 million cash for a group of over-the-counter pharmaceutical brands including Beano and Tagamet, its largest acquisition ever.
The Irvington, N.Y., company said Tuesday it is also buying pain relievers BC, Goody's, and Ecotrin, gastrointestinal brands Beano, Gaviscon, Phazyme, Tagamet, and Fiber Choice, and Sominex sleep aids - 17 brands in all. With this deal and several other recent acquisitions, Prestige says its annual revenue will total about $600 million. In the six months ended in September, the company's revenue rose to $200.8 million.
Shares of Prestige Brands surged $1.87, or 20 percent, to $11.20, while U.S.-listed shares of GlaxoSmithKline gained 30 cents to $45.23.
Prestige said the GlaxoSmithKline brands will start adding to its profit in the fiscal year starting April 1. It said over-the-counter products will account for about 85 percent of revenue, or about $500 million, and 90 percent of profits once the deal is complete. Besides health care brands, the company also sells household cleaning products such as Comet Classic and Spic and Span.
The deal will be reviewed by U.S. antitrust regulators, and Prestige said it is working to secure financing for the purchase.
In September 2010, Prestige agreed to buy Blacksmith Brand Holdings Inc., which sells Efferdent and Effergrip denture care products, PediaCare children's medicines, Luden's cough drops and other products. In December 2010 it bought the motion sickness medicine Dramamine from Johnson & Johnson.
GlaxoSmithKline, which announced in February it would sell its noncore consumer healthcare products to focus on its core markets, said it plans to return proceeds to shareholders in 2012.