Takeover by Elan valued at £101m

 

Elan Corporation has increased its presence in the drug delivery market with the purchase of Nano Systems, a subsidiary of Eastman Kodak, for $150 million (£101 million).

The transaction will be completed sometime in the fourth quarter subject to regulatory approval, although Elan does not expect the acquisition to enhance its earnings until the year 2000. Elan is buying the company with $137 million in cash and the rest in warrants to purchase Elan shares.

This latest acquisition means the company has spent $1.3 billion on acquisitions over the last 10 months. Chief executive Mr Donal Geaney said the company does not expect to make another acquisition this year.

Nano Systems specialises in technology which helps to break down drugs which are poorly water soluble. The company adds a polymer compound to drugs, making them easier for the body to absorb.

Nano Systems employs 60 people at its headquarters and research facility at King of Prussia, Pennsylvania. Elan will now move its drug delivery headquarters to King of Prussia as it is close to many of the largest pharmaceutical and drug companies in the United States. Nano Systems as of December 31st had net assets of $7.9 million with net income of $1.4 million.