5. Business combinations
In the first half of 2021, the scope of consolidation has changed as a result of the following transactions:
Acquisition of pharmacies. Galenica acquired 100 % of the interests in pharmacies in various locations in Switzerland. Upon acquisition, most of these pharmacies were merged with Galenicare Ltd.
The purchase consideration amounted to CHF 3.6 million and was fully settled in cash. The fair value of the provisional net assets amounts to CHF 0.3 million at the acquisition date. The goodwill of CHF 3.3 million was allocated to the operating segment Products & Care and corresponds to the added value of the pharmacies based on their locations. Transaction costs were insignificant.
Acquisition of the pharma business of Dr. Wild & Co. AG. On 27 May 2021, Galenica acquired the range of pharmaceutical products of the Swiss company Dr. Wild & Co. AG, including the well-known brands Vitamin D3 Wild Oil® and VI–DE 3®. In addition, the experienced physician field service of Dr. Wild & Co. AG was transferred to Verfora.
The purchase consideration amounted to CHF 34.7 million and was fully settled in cash. The fair value of the net identifiable assets amounted to CHF 26.8 million at the acquisition date. The goodwill of CHF 7.9 million was allocated to the operating segment Products & Care and corresponds to the added value based on the acquirer-specific synergies expected to arise from the acquisition in strengthening its leading position in the Swiss consumer healthcare (CHC) market and the know-how of the employees gained. Acquired intangible assets include trademarks with an indefinite useful life of CHF 22.8 million. As the acquisition date was recent, the purchase price allocation is yet to be finalised. Transaction costs were insignificant.
Business combinations
|
in thousand CHF |
Pharma business of Dr. Wild & Co. AG |
Pharmacies |
Fair value |
|
Inventories |
2,141 |
339 |
2,480 |
|
Right-of-use assets |
– |
952 |
952 |
|
Intangible assets |
24,634 |
– |
24,634 |
|
Lease liabilities |
– |
–952 |
–952 |
|
Other current and non-current liabilities |
– |
–24 |
–24 |
|
Fair value of net assets |
26,775 |
315 |
27,090 |
|
Goodwill |
7,875 |
3,334 |
11,208 |
|
Purchase consideration |
34,650 |
3,649 |
38,299 |
|
Payment of consideration due to previous business combinations |
|
|
70 |
|
Net cash flow from business combinations |
|
|
38,369 |
Pro forma figures for acquisitions made in the first half of 2021
Since their inclusion in Galenica's scope of consolidation, the businesses acquired contributed net sales of CHF 3.2 million and an operating result (EBIT) of CHF 0.6 million to the Group's results. If these acquisitions had occurred on 1 January 2021, they would have contributed additional net sales of CHF 4.5 million and increased EBIT by CHF 1.0 million.