AmerisourceBergen Corporation’s $815 Million Acquisition of H. D. Smith

Citi acted as financial advisor, and Cravath, Swaine & Moore LLP provided legal advice to AmerisourceBergen. Morgan Stanley acted as financial advisor, and Schiff Hardin LLP provided legal advice to H. D. Smith.

AmerisourceBergen Corporation (NYSE:ABC) and H. D. Smith today announced that the companies have signed a definitive agreement under which AmerisourceBergen will purchase H. D. Smith, the largest independent wholesaler in the U.S., for $815 million in cash. AmerisourceBergen plans to fund the acquisition through the issuance of new long-term debt. The acquisition is expected to be slightly accretive to adjusted diluted earnings per share (EPS) in fiscal year 2018, and to achieve full run-rate synergies and be approximately $0.15 accretive to the Company’s adjusted EPS in fiscal year 20201. This acquisition was not contemplated in the previous guidance the Company provided for fiscal year 2018. Based on the estimated contribution of this acquisition, the Company now expects revenue growth to be in the range of 8 percent to 11 percent, adjusted operating income growth to be in the range of 4 percent to 7 percent and Pharmaceutical Distribution Services segment operating income growth in the range of 4 percent to 7 percent. AmerisourceBergen is reaffirming the rest of its previously announced fiscal 2018 financial guidance. The transaction is subject to regulatory review and other closing conditions and is expected to close in early calendar 2018.

The Cravath team included partners Damien R. Zoubek (Picture) and Keith Hallam and associate Peter J. Atlee on M&A matters; partner Christine A. Varney and associate Kate F. Stamell on antitrust matters; partner David J. Kappos and associate Nicholas Kypriotakis on intellectual property matters; partner J. Leonard Teti II and associate Richard Bohm on tax matters; partner Eric W. Hilfers and associates Matthew Cantor and Christopher C. Gonnella on executive compensation and benefits matters; partner Matthew Morreale on environmental matters; and senior attorney Joyce Law and practice area attorney Brian M. Budnick on real estate matters. Aashim Usgaonkar also worked on M&A matters.

Involved fees earner: Damien Zoubek – Cravath Swaine & Moore; Keith Hallam – Cravath Swaine & Moore; Peter Atlee – Cravath Swaine & Moore; Christine Varney – Cravath Swaine & Moore; Kate Stamell – Cravath Swaine & Moore; David Kappos – Cravath Swaine & Moore; J. Leonard Teti II – Cravath Swaine & Moore; Richard Bohm – Cravath Swaine & Moore; Eric Hilfers – Cravath Swaine & Moore; Matthew Cantor – Cravath Swaine & Moore; Matthew Morreale – Cravath Swaine & Moore; Joyce Law – Cravath Swaine & Moore; Brian Budnick – Cravath Swaine & Moore;

Law Firms: Cravath Swaine & Moore;

Clients: AmerisourceBergen Corporation;


Author: Ambrogio Visconti