Insider Media Limited

Dechra Pharmaceuticals, based in Stoke, has acquired DermaPet, a US-headquartered veterinary company, in a deal worth $64m. A sum of $42m will be paid on completion of the deal.

Payments of $1m are then due on the second and fourth years of the completion date. This will be followed by $15m, which will be payable between the second and sixth years of completion if DermaPet achieves revenues in excess of $15m in any rolling 12-month period following the first year of completion.

The acquisition was advised by the Birmingham office of DLA Piper.

Dechra, a veterinary product specialist, also agreed a new £78m, four-year bank facility which will replace its existing borrowing facilities and finance the acquisition.

In its latest interim statement in June this year, Florida-based DermaPet had revenues of $6.9m and pre-tax income was $3m. Gross assets at 30 June 2010 were $2.8m.

Ian Page, chief executive of Dechra, said: "This acquisition is expected to be materially earnings enhancing in its first full year of ownership. It also further strengthens our position as a leader in the worldwide veterinary dermatological market whilst significantly increasing our presence and scale of operation in the United States.

"The DermaPet brand and the high quality natural product line is a perfect fit with our existing dermatological range and accelerates Dechra's strategic objective of becoming a leading supplier of specialist veterinary exclusive products in this key market."