Aspen selling Brazilian plant after drop in revenues
Aspen broke into the Latin American market through a series of transactions with India-based Strides but the Brazilian business suffered in the second half of 2009. In response Aspen has initiated a restructuring programme which includes the sale of a facility back to Strides.
The Indian firm is poised to buy the site in Campos in south east Brazil for $75m (€55m). Regulatory approvals of the deal are yet to be issued but Strides has already been engaged to manage the facility and will assume the risks and rewards of the operation.
Construction of the site was finished in 2008 and since then it has been producing oral solid dosage forms, injectable penicillin and antibiotics. Aspen gained a control of the site in September 2008 when it increased its stake in Strides’ Latin American operations to 51 per cent.
Since buying its way into Latin America Aspen has sought to increase its market share, particularly in Brazil. In 2008 Aspen recruited 150 experienced sales representatives to target Brazil but the following year noted that “the potential of this territory remains to be realised”.
The South African company is restructuring its operations in Latin America, selling the Campos facility and related products and altering business structures and sales teams to fit its new strategy. Aspen retains manufacturing facilities in Toluca, Mexico and Vitória, Brazil.
Resources are now being focused on identifying and pursuing opportunities to increase its private market product portfolio. This process is already underway, with Aspen stating that a number of negotiations are at an “advanced stage”.
Global manufacturing expansion
The sale of the facility in Brazil comes at a time when Aspen is strengthening its manufacturing presence in other areas of the world. Over the past 12 months it has acquired a production facility in Bad Oldesloe, Germany from GlaxoSmithKline and also strengthened in South Africa.
Operations are underway at a second oral dose facility and eye-drop suite at Aspen’s site in Port Elizabeth, South Africa and more expansions are in the pipeline. These include a hormonal suite, increased tabletting capacity and the addition of suppository and Dutch medicines capabilities.
