Good report by Scotia this morningRidgeway's report this morning summed it up nicely.
expected $7+ earnings in 2016 so P/Cash E = 6x, EV/adj Ebitda= 8.7x
net debt/Ebitda= 4.5x
he describes how the acquisition transforms the company by opening oppurtunities for growth (significant organic) and lowers risk by diversification. after acquisition, 40% of sales will be in UK, 40% in USA and 20% in ROW. the acquisition reduces the largest drug (Donatel) to 9% of the revenue stream and no other single drug is above 5%. The expansion outside the US dilutes the issue of price increase fixing. He had done his modeling with 5% price increases in US and when he recalculated them with no price increases it only lowered 2016 revenue target by 1% and Ebitda by 1.5%.
Need to get this deal done and start executing on the earnings projection. markets are the markets. sometimes irrational. this is one of those times.