Adcock in deal with black groups

SOUTH Africa's second largest pharmaceutical company Adcock Ingram is to facilitate an effective acquisition of 13percent of its issued share capital by black South African employees and broad-based black economic empowerment groupings.

Valued at R1,3billion, the Kagiso Health Consortium and Kurisani Youth Development Trust will indirectly hold interests of 7,15percent and 2,6percent of Adcock's share capital, respectively.

Adcock said these partners were chosen for their business and broad-based empowerment credentials, and for healthcare and education initiatives they provide to poor communities.

The BEE partners will acquire 75percent of the transaction. The remaining 25percent has been set aside for employees. Adcock Ingram chief executive Jonathan Louw said this was a "one-size-fits-all" deal.

Adcock's existing and future black South African employees will receive the same entitlement.

The company is the largest over-the-counter medicine manufacturer in the country, and the group yesterday presented its first full-year results as an independent group since unbundling from Tiger Brands and listing on the JSE.

Turnover for the year ended September was up 21,3percent higher at R4billion benefiting from 12percent volume growth across the business, a single exit price increase and an improved product mix.

Profit after tax rose 19,1percent to R789,9million.

The year was challenging for the pharmaceutical division because of the economic slowdown and the investment in supply chain infrastructure, which hampered stock availability and the ability to service customers.

The second six months saw a recovery of the premium brands in Pharmacy, mainly due to the seasonability in the cold and flu portfolio.