STADA Arzneimittel AG — M&A Activity 2012

Aug 7, 2012

News Details

Ad-hoc | 7 August 2012 11:10

STADA: Sale of two Russian production facilities in the context of the production restructuring according to ‘STADA – build the future’ expected within Q3/2012

STADA Arzneimittel AG / Key word(s): Miscellaneous

07.08.2012 11:10

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Bad Vilbel, August 7, 2012 - STADA Arzneimittel AG (hereinafter referred to
as 'STADA'), Bad Vilbel, expects a sale of two Russian production
facilities within the current third quarter of 2012. Today at a joint
meeting of the Executive Board and Supervisory Board, both boards agreed to
such a sale. This decision is based on a contract that is largely ready to
be signed, according to which all assets of both Russian production
facilities will be transferred via a sale of STADA's indirectly wholly
owned subsidiaries OOO Makiz Pharma, Moscow, and OOO Skopin Pharmaceutical
Plant, Ryazanskaya obl., to LLC DMN Invest, Moscow (currently being
founded), in the context of a partial management buyout. After today's
decision by the STADA boards, this contract as well as associated temporary
service agreements are expected to be signed promptly in the current third
quarter of 2012.

In the context of this disposal, which represents another significant step
in the production restructuring in the context of the Group-wide cost
efficiency program 'STADA - build the future' introduced in 2010 (see the
Company's Ad-hoc release of June 7, 2010 as well as STADA's Annual Report
2011), STADA incurs a one-time burden on earnings in the amount of
approximately Euro 9.0 million before taxes or approximately Euro 7.2
million after taxes, which STADA will report as a one-time special effect
in the third quarter of 2012. This burden is less than the expenses
originally planned in the context of 'STADA - build the future' for the
Russian production restructuring.

The production of all products, which are currently produced for the STADA
Group in both Russian production facilities planned for sale, will be
gradually transfered to other existing Russian STADA production facilities
- expected to be finalized by the end of 2014 in the context of a program
that has already commenced - whose capacity utilization and cost structure
will be substantially improved on the mid-term as a result. Regarding such
products made for Russian STADA sales companies that are initially still
produced in the sold production facilities during this transitional period,
comprehensive supply and service agreements with the acquirer will ensure a
continued supply for the period required by STADA and largely following the
internal STADA transfer price structure.

The transaction will still be subject to various completion conditions upon
being signed. The sale is strived to be completed in the fourth quarter of
2012. In the context of the completion, as part of the restructuring,
approximately 182 full-time positions in the STADA production companies at
the locations of both sold production facilities will be immediately
reduced and the affected persons will be employed at previous conditions by
the purchaser in the future. In the context of the transaction, the
purchaser will also assume the contractual obligation for a further up to
approximately 200 full-time positions - which will initially remain with
local STADA subsidiaries at the locations of both sold production
facilities in order to secure the ongoing production transfers - to offer
each affected person employment at previous conditions when they are laid
off by the local STADA subsidiaries after completion of the transfers at
the latest. As a result of this personnel reduction, STADA could incur
further one-time burdens of up to Euro 2 million by the end of 2014, for
which, however, from today's perspective, a total amount of significantly
less than Euro 1 million is expected.

Due to the sale of the Russian plants STADA will reach a significant
restructuring goal of the 'STADA - build the future' program earlier than
planned, presumably within the current financial year 2012, namely the
reduction of the number of personnel of 2010 by approximately 10%
(corresponding to approximately 800 full time positions) throughout the
Group by the end of 2013.

Additional information:
STADA Arzneimittel AG / Corporate Communications / Stadastraße 2-18 / D -
61118 Bad Vilbel /
Tel.: +49(0) 6101 603-113 / Fax: +49(0) 6101 603-506 / E-Mail:
communications@stada.de /
Or visit us in the Internet at www.stada.com

07.08.2012 DGAP's Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Media archive at www.dgap-medientreff.de and www.dgap.de

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Language: English
Company: STADA Arzneimittel AG
Stadastraße 2-18
61118 Bad Vilbel
Germany
Phone: +49 (0)6101 603- 113
Fax: +49 (0)6101 603- 506
E-mail: communications@stada.de
Internet: www.stada.de
ISIN: DE0007251803, DE0007251845,
WKN: 725180, 725184,
Indices: MDAX
Listed: Regulierter Markt in Düsseldorf, Frankfurt (Prime Standard);
Freiverkehr in Berlin, Hamburg, Hannover, München, Stuttgart

End of Announcement DGAP News-Service

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