Zoetis to sell medicated feed additive portfolio to Phibro Animal Health

Zoetis creates products for animals in agricultural settings as well as companion animals.

Parsippany-based Zoetis on Sunday said it will sell its medicated feed additive portfolio and certain other assets to animal nutrition company Phibro Animal Health in a $350 million deal.

The transaction would also involve some of Zoetis’ water-soluble products and six manufacturing sites across the U.S., Italy and China.

The acquired portfolio is expected to boost Teaneck-based Phibro Animal Health’s profitability and earnings margin and be accretive to its adjusted earnings per share.

The transaction is expected to be complete in the second half of the calendar year.

More than 300 Zoetis colleagues who support manufacturing, distribution and commercial activities are expected to transition to Phibro Animal Health.

“We remain committed to providing innovative solutions to our livestock customers,” Kristin Peck, CEO of Zoetis, said. “We believe that the long-term value of the transferred portfolio will be fully realized with Phibro Animal Health, which will continue to expand its reach, given their strong relationships with customers worldwide.”

Zoetis’ strong portfolio of MFA and water-soluble products across cattle, swine and poultry will complement and expand Phibro Animal Health’s species and product portfolios, helping customers meet the highest standards of animal care, prevent disease, and enhance nutrition.

“Over a long period of time, Zoetis has built a valuable, high-quality and reliable source of medicated feed additives around the globe,” Jack Bendheim, chairman, CEO and president of Phibro Animal Health, said. “This investment will enhance, diversify and broaden our portfolio globally and help us continue to deliver value to our customers and to our shareholders. We believe our cash generation will allow for continued investment into our higher growth businesses of Nutritional Specialties, Companion Animal and Vaccines. I am confident we have the right capabilities to integrate and strengthen this business. I look forward to collaborating with the Zoetis team and welcoming new colleagues to Phibro Animal Health to support this portfolio.”

Guggenheim Securities LLC is acting as exclusive financial adviser to Zoetis and Wachtell, Lipton, Rosen & Katz is acting as legal adviser. Citi is acting as exclusive financial adviser to Phibro and Kirkland & Ellis LLP is acting as legal adviser.