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Ranbaxy Laboratories has announced the acquisition of Be-Tabs Pharmaceuticals (Pty) Ltd in South Africa for a total consideration of $70 million. The transactions, subject to requisite approvals from South Africa's Competition Council authority, are expected to be completed in the first quarter of the year 2007. Be Tabs is the fifth largest generics player in South Africa with an excellent brand equity and a good profitable track record. For Ranbaxy this is a significant acquisition in a large and growing market with high entry barriers and enables it to become among the top five generics companies in the market. Be Tabs has a strong OTC portfolio with significant brand recognition that can be leveraged with wholesalers, pharmacists and consumers. It is the largest penicillin manufacturer in South Africa. The transactions will be funded from Company's FCCB proceeds and is valued at 2.2 times of sales and 7.7 times of EBITDA multiples. The acquisition will be EPS accretive in year one. South Africa is the largest pharma market in Africa, valued at close to $2 billion, with a high potential for generic growth. Ranbaxy South Africa commenced its commercial operations in 1996 and caters to acute, chronic and OTC therapeutic segments.
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