Uniphar plan Nordic entry as managers look to bonuses

Irish healthcare services firm raised €135m in IPO

Uniphar, the Irish healthcare services company that floated on the stock market on Wednesday, is planning to enter the Nordic market in the coming months, after raising €135 million in its initial public offering (IPO), according to documents relating to the share sale.

While the company’s historic business has been as a pharmaceuticals wholesaler, its fast-growing commercial division, which helps drug and medical device makers sell products; and clinical and products access unit, which sources and supplies unlicensed medicines for retail and hospital pharmacy customers, have driven the business in recent years.

The two divisions’ share of group earnings has grown from 18 per cent in 2016 to 69 per cent in 2018, according to prospectus documents prepared for investors ahead of the IPO.

Benelux market

Having committed £24 million (€26.7 million) of the IPO proceeds to an upfront payment for the purchase of Durbin, a specialist supplier of pharmaceuticals in the UK and US, the company said in the documents that further funds would be used as it targeted a Nordic market entry in 2019 for its commercial and clinical unit. The division entered the Benelux market last year in an initial foray into continental Europe.

Uniphar, which counts 1,100 independent pharmacists among its legacy shareholders, said last month, as it confirmed its flotation plans, that it aimed to double its earnings before interest, tax, depreciation and amortisation (ebitda) to nearly €100 million over the next five years.

The prospectus shows that the company, led by chief executive Ger Rabbette and chaired by former Tesco Ireland managing director Maurice Pratt, set up a share bonus plan last year that entitles 37 top staff to as much as 4.9 per cent of its total shares at the end of 2022, subject to certain performance conditions being met.

Diluted shares

Managers and key staff owned 18 per cent of Uniphar before the flotation, but their shares have been diluted by about 40 per cent as a result of fresh stock being issued under the IPO.

Uniphar said last week that “certain existing” shareholders, understood to be pharmacists, sold a total of €1.27 million worth of shares to new investors alongside the IPO, leaving them with about €112 million of stock at the time.

Most of the pre-IPO shareholders in the company, including large pharmacist shareholders, managers and the family behind the Sisk construction-to-property group that sold its healthcare unit to Uniphar last year, have committed to not selling shares for 12 months after the flotation.