Zoetis to Offload Medicated Feed Additive Portfolio to Phibro Animal Health

Today, Zoetis announced a definitive agreement with Phibro Animal Health for the acquisition of Zoetis’ medicated feed additive (MFA) product portfolio, certain water soluble products, and related assets. The transaction is valued at $350 million, subject to customary closing adjustments, and is expected to finalize in the second half of calendar year 2024.

The acquisition is a strategic move for both companies, as Zoetis and Phibro Animal Health share a deep commitment to the production animal health sector. Zoetis’ MFA product portfolio, which generated approximately $400 million in revenue in 2023, comprises over 37 product lines distributed across roughly 80 countries. Additionally, the agreement includes six manufacturing sites, located in the U.S., Italy, and China, with over 300 Zoetis employees expected to transition to Phibro Animal Health to support manufacturing, distribution, and commercial activities.

For Zoetis, this transaction underscores its disciplined capital allocation strategy, allowing the company to focus its investments on animal health, productivity, and sustainability solutions. By divesting this portfolio, Zoetis can concentrate its livestock investments in other areas such as vaccine, biologic, and genetic programs.

Kristin Peck, CEO of Zoetis, emphasized the company’s commitment to providing innovative solutions to livestock customers, expressing confidence in Phibro Animal Health’s ability to further expand the transferred portfolio with its strong global customer relationships.

The acquisition is expected to complement and expand Phibro Animal Health’s species and product portfolios, enhancing its ability to deliver top-tier animal care, disease prevention, and nutritional solutions across cattle, swine, and poultry segments. On a combined basis, Phibro Animal Health’s sales for the last twelve months would have been approximately $1.4 billion, with expectations for increased profitability and EBITDA margin post-acquisition.

The acquisition will be primarily funded through debt, with financing commitments secured from key relationship banks. Phibro Animal Health anticipates a net leverage of 3.5-4.0x Debt / Adjusted EBITDA at close, aiming to reduce it to below 3.0x by the fiscal year end June 30, 2027.

Jack C. Bendheim, Chairman, President, and CEO of Phibro Animal Health, highlighted the strategic value of the investment, expressing confidence in the company’s ability to integrate and strengthen the acquired business. He anticipates continued investment in higher-growth segments such as Nutritional Specialties, Companion Animal, and Vaccines.

Both Zoetis and Phibro Animal Health are committed to ensuring a seamless transition and uninterrupted supply of products for their customers. Guggenheim Securities, LLC and Wachtell, Lipton, Rosen & Katz are acting as financial and legal advisors to Zoetis, while Citi and Kirkland & Ellis LLP are serving in the same capacities for Phibro Animal Health.

Phibro Animal Health will be hosting an investor call on April 29 at 8:30 am for interested parties to learn more about the transaction. Further details can be found

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