Two buyout firms vie for patch maker LTS Lohmann -sources (updated)

Hisamitsu Pharmaceutical Co

25/11/2013 15:51

* Wendel, Nordic Capital hand in final bids - sources * Bids value LTS Lohmann at about 1.2 bln euros - sources * Hisamitsu, EQT, Blackstone, KKR drop out - sources (Adds details on valuation, background) FRANKFURT, Nov 25 (Reuters) - The bidding for German medical skin patch maker LTS Lohmann has turned into a two-way race between buyout firms Wendel and Nordic Capital, valuing the company at about 1.2 billion euros ($1.6 billion), three people familiar with the matter said. Nordic Capital may be looking to combine LTS Lohmann with another skin patch maker it agreed to buy last month, Acino ACIN.S . Nordic had teamed up with Avista Capital Partners to acquire the Swiss firm, which makes a contraceptive patch for Bayer  BAYGn.DE .  ID:nL6N0HS1BQ  The sources said that Japan's Hisamitsu Pharmaceutical 4530.T  and private equity house EQT were no longer being considered as suitors by LTS Lohmann's owners, which include drug major Novartis  NOVN.VX .  Interest from Blackstone  BX.N , which had been looking to combine LTS Lohmann with its drug contract manufacturing subsidiary Catalent, has cooled, the sources added. KKR  KKR.N , which had been seeking to complement its hard capsules maker Capsugel, has also lost interest, they said. Wendel of France, Nordic Capital of Sweden, EQT, KKR, Hisamitsu and Blackstone all declined to comment.  Officials at LTS Lohmann and Novartis were not immediately available for comment. LTS Lohmann makes about 286 million euros in annual sales from nicotine and other medical patches to treat conditions including Parkinson's and Restless Legs Syndrome.  Patches of the type made by the firm have become increasingly important in the drugs industry since they offer a convenient and reliable way of delivering a variety of medicines. The bids value the group - which developed the first nicotine patch for the U.S. market, launched in 1991 - at about 12.6 times earnings before interest, taxes, depreciation and amortisation (EBITDA) of about 95 million euros.  Listed healthcare companies in Europe trade at a multiple of about 11, data from Thomson Reuters StarMine show. Novartis holds a 43 percent stake in LTS Lohmann, while German billionaire Dietmar Hopp, who co-founded software giant SAP  SAPG.DE , holds about 30 percent. German investment company BWK owns a 24 percent stake. Spokesmen for Hopp's investment vehicle and for BWK declined to comment. A key question for the future owner will be whether LTS Lohmann can succeed in preventing generic drugmakers from launching cheap copies of its Exelon patch for mild to moderate dementia. Novartis has sued Actavis  ACT.N  for trying to bring its version to market. (Reporting by Arno Schuetze, Ludwig Burger and Claire Ruckin; Additional reporting by Alexander Huebner, Frank Siebelt and Emi Emoto; Editing by Jonathan Gould and Pravin Char) ((arno.schuetze@thomsonreuters.com)(+49.69.7565.1197)(Reuters Messaging: arno.schuetze.reuters.com@reuters.net)) Keywords: NOVARTIS LTS/SALE