MOSCOW: Sistema, a publicly traded diversified Russian holding company, has completed the acquisition, together with a financial partner, of a 46.5% equity stake in Sintez Kurganskoe Medical Products Company (Sintez) and a 75.1% equity stake in Biocom, through holding company Sinocom Investments Limited (Sinocom), from investment firm Marathon Group for a consideration of RUB 11.8 billion.

The 46.5% stake in Sintez was acquired by Sinocom for RUB 8.2 billion in a transaction financed jointly by Sistema and a financial partner.

Subsequently, in order to combine the businesses, newly acquired Sintez purchased a 75.1% stake in Biocom from Sinocom for RUB 3.6 billion. The purchase of Biocom shares was funded with Sintez’s own capital and funds borrowed by Sintez.

The companies have complementary portfolios in terms of product types, have collaborated in the area of sales for many years, and are managed by a single executive team. The consolidation of the assets into Sintez will capture existing synergies and support the further growth of shareholder value.

Sinocom intends to make a public offer (mandatory tender) to minority shareholders of Sintez to acquire their ordinary registered shares in the company.

Sistema and its financial partner have concluded an agreement under which Sistema will acquire its financial partner’s stake in Sinocom within three years of the transaction closing.

Sintez and Biocom – together with Alium, a pharmaceutical company being created by Sistema through the merger of OBL Pharm and Binnopharm – will be a major market player, possessing the potential to become a top-3 Russian pharmaceutical company in the commercial segment. The combined product portfolio of Sintez, Biocom and Alium will include more than 500 products and its manufacturing capacity will consist of six production facilities in Moscow, the Moscow region, Kurgan and Stavropol.

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