Perrigo Closes Acquisition of Infant Formula Manufacturer PBM Holdings

Perrigo funded the transaction using approximately $193 million of cash on hand and $200 million borrowed under its existing debt agreements. The remaining funding came from a just completed $415 million private placement note issuance with a weighted average interest rate of 5.23%.

4 May 2010 --- Perrigo Company announced that it has closed the previously announced acquisition of PBM Holdings, Inc., the world’s largest manufacturer of infant formula for store brand markets. Headquartered in Gordonsville, Virginia, PBM manufactures and distributes over-the-counter (OTC) store brand infant formula and baby foods sold by retail supermarkets and pharmacies in the United States, Canada, Mexico and China.

Under the terms of the agreement, Perrigo acquired 100% of the shares of PBM Holdings, Inc. for $808 million in cash. Pursuant to the agreement, Perrigo and PBM expect to make an election under §338(h)(10) of the Internal Revenue Code that will increase Perrigo’s tax basis in the acquired assets and which is expected to result in cash tax savings of approximately $150 million to Perrigo over the next 15 years. Perrigo funded the transaction using approximately $193 million of cash on hand and $200 million borrowed under its existing debt agreements. The remaining funding came from a just completed $415 million private placement note issuance with a weighted average interest rate of 5.23%.

Perrigo Company is a leading global healthcare supplier that develops, manufactures and distributes OTC and generic prescription pharmaceuticals, nutritional products, active pharmaceutical ingredients (API) and consumer products. The Company is the world’s largest manufacturer of OTC pharmaceutical products for the store brand market. The Company’s primary markets and locations of manufacturing and logistics operations are the United States, Australia, Israel, Mexico and the United Kingdom.