UDG Healthcare invests €105m to expand communications unit

UDG Healthcare is to buy the healthcare communications businessof KnowledgePoint360 for €105 million, helping to fulfil a key part of the company's global strategy.

The deal, which is expected to close by the end of March, will complement UDG’s existing healthcare communications services, which are offered through its Ashfield Division in the UK and the US, and allow the company to expand further in Europe and further afield.

UDG chief executive Liam FitzGerald said the deal would be a significant strategic and complementary acquisition.

“KnowledgePoint360 is a strong and well-established business, with an excellent management team and highly qualified work force that has a style and values similar to our own,” he said. “Our Ashfield business has had great success with previous acquisitions in the healthcare communications market, including InforMed and Watermeadow.”

KnowledgePoint360 generated revenues of $106 million in 2013, with earnings before interest, taxation, depreciation and amortisation of $20 million, and has recorded growth at mid- to high-single-digit rates in recent years. It employs over 600 staff across 10 global locations.

UDG said the acquisition would be financed from existing cash facilities.

Davy Stockbrokers’ Jack Gorman took a favourable view of the deal.

“Our first thoughts on this deal are positive as regards strategic fit, a reasonable purchase multiple and earnings accretion,” he said.