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news.Nursing home drug provider Omnicare has entered into an agreement to purchase rival NeighborCare in a transaction valued at approximately $1.8 billion.
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The definitive merger agreement was unanimously approved by the directors of both companies. Omnicare agreed to pay $1.55 billion to secure the deal that will result in the creation of a nationwide pharmacy network across 47 US states and the District of Columbia.
The companies project the combined annualized revenue would be approximately $6 billion, based upon results for Omnicare and NeighborCare for the quarter ending March 2005.
Under the agreement, Omnicare will acquire all of the outstanding shares of NeighborCare common stock for $34.75 per share in cash, for a total transaction value of approximately $1.8 billion, which includes approximately $245 million of NeighborCare’s net debt.
Joel Gemunder, president and CEO of Omnicare, said: “More than a year in the making, the combination of our companies, we believe, will create a premier institutional pharmacy company and result in substantial benefits to both companies’ customers, employees and other interested constituencies.”