Ascendis Health Limited CEO Karsten Wellner

South African over-the-counter (OTC) healthcare products maker Ascendis Health Limited said on Wednesday it plans to acquire Romanian alternative medicine products distributor Sun Wave Pharma for 42.5 million euro ($47.7 million).

The business will be acquired with a maximum deferred payment of 23 million euro over three years based on financial targets, and will be accretive from May 2017, Ascendis said in a press release.

“Sunwave provides an attractive platform for Ascendis to enter the high growth Romanian and eastern European OTC markets. The business has a strong sales and profit track record based on a unique distribution model of marketing complementary medicines directly to doctors through a sales force of 290,” Ascendis CEO Karsten Wellner said.

Another reason for the acquisition was that Sun Wave has a well-diversified product, customer and supplier portfolio, margins of close to 20% and a strong product pipeline. “We have identified multiple potential synergies and cross-selling opportunities with the Ascendis wellness and OTC ranges, and believe that Sunwave’s successful distribution model can be replicated in surrounding eastern European countries,” Wellner added.

Sun Wave Pharma was founded in 2008 in Romania by Yogish Agarwal, former country head of the Romanian unit of Indian drug maker Ranbaxy. It is organised in nine business units and some 318 employees. Ascendis Health is a market leader in health and care products, owning some of the most recognised brands in South Africa.

Its portfolio of products is spread across diverse revenue streams and markets in three divisions: Ascendis Consumer Brands, Ascendis Pharma-Med and Ascendis Phyto-Vet. It mostly sells OTC medicines and consumer brands products, functional foods, functional super foods, sports nutrition products, health beverages, weight management products and therapeutic cosmetic products. Earlier this year, Ascendis acquired Cyprus-based pharmaceutical manufacturer, Remedica Holdings and leading European sports nutrition business Scitec International, for a combined 430 million euro.