Medivir has entered into an agreement to sell its subsidiary BioPhausia (Nordic Brands) to Karo Pharma for Skr908m ($100.9m).

This price will be on a cash and debt free basis, including a normalised working capital.

The transaction is expected to close by mid-December.

As previously announced in June and August this year, the board of directors of Medivir tasked the management to explore a separation of the group’s operations into two independent companies in order to separately list the commercial operations.

“I am convinced that this sale of the Nordic Brands portfolio to Karo Pharma is the best way to maximise the value for our shareholders.”

Meanwhile, the Nordic Brands portfolio (BioPhausia AB) has drawn significant interest from several prospective buyers.

During a structured process of evaluation of a sale versus a separate listing, the board of directors of Medivir concluded that a divestment of BioPhausia AB to Karo Pharma is the best option.

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By GlobalData

BioPhausia comprises 13 established pharmaceutical drugs. From the third quarter of 2015 to the second quarter of 2016, BioPhausia posted revenues of Skr189m ($21m).

Transaction costs are estimated to be approximately Skr25m ($2.7m) while the separation process and operational realignment as a result of the sale will lead to additional one off costs of approximately Skr15m ($1.6m).

The employees that serve this operation are not part of the deal and approximately ten will have to leave Medivir post-transaction.

Completion of the deal is subject to customary provisions. The purchase price will be paid in cash only.

Medivir CEO Niklas Prager said: “I am convinced that this sale of the Nordic Brands portfolio to Karo Pharma is the best way to maximise the value for our shareholders.

“The commercial portfolio can continue its positive development in an organisation with a strong focus on specialty pharmaceuticals, while Medivir can focus fully on its transformation to an oncology focused and effective R&D company with an exciting portfolio of projects in different stages of development.”