Concordia Healthcare Corp. T.CXR.R

Did CXR Overpay for Amdipharm Mercury...?

[FootballFan1]

From the CXR press release dated September 8, 2015: "The total purchase price will consist of cash consideration of approximately 800 million (approximately US$1.2 billion), 8.49 million common shares of Concordia (approximately US$0.7 billion), and the assumption of approximately US$1.4 billion AMCo net debt upon closing, as well as a maximum performance-based earn-out of 144 million payable in cash in the fourth quarter of 2016 (approximately US$220 million). Following the closing of the transaction, Concordia will own a 100% stake in AMCo, and Cinven will hold an expected 19.9% ownership in Concordia on a non-diluted basis and before giving effect to the anticipated equity offering."

[pineapple1]

This post has been removed in accordance with Community Policy

[adamchess]

It seems CXR management did the math and decided that AMCo deal will pay for itself in relatively short time and that there will be synergies between the two previous companies that generates more revenues to the new combination over time. AMCo has a much wider marketing platform worldwide that benefits new product distributions that CXR previously could not acquire. There was an interview from MT

[sunshine7]

seems there is a concerted effort to bury good information under a pile of meaningless garbage posts. Well, to the top of the pile with this one and please refrain from personal attacks and responding to such. It will go a long way to improving the image of this board.

[sunshine7]

We will know in 3 weeks. All on the table then. If the acquisition is (immediately or near term) accretive, then no, they did not over pay. Both sides understand value and I am certain they wanted to get a deal done. There was a PR done recently interviewing the party's lawyers. Worthy of a read. The bulk of the debt was paid with shares at USD$65 and long term debt at 4-5%. De-risked their

[FootballFan1]

Excerpt from a National Post article by Damon Van Der Line dated September 10, 2015: "Since the deal has been announced there has been a lot of talk around what they paid and whether they overpaid for this and I think thats something that isnt knowable at this point in time, said Bruce Campbell of Stone Castle Investment Management Inc. He said that although there have been concerns over

[Lumberfeverlong]

Thank you for posting. This is a reasonable take on CXR debt levels and valuation. Earnings in a couple of weeks will provide the clarity we all seek. If guidance is met or exceeded and company announces further debt repayments, this stock should see a nice and steady climb above $60 in a relatively short period of time. 

[adamchess]

I believe Bruce Campbell's fund had a significant holding of Concordia after this article was written - meaning they were not too concerned with the debt at the time. His investments are more concervative now with a large holding of cash last time he was on BNN.