Cardinal Health Still Seeking To Acquire China Drug Distributors

Sep.28.11 | About: Cardinal Health (CAH)
Cardinal Health (NYSE: CAH), the US drug distribution company, is still hunting for M&A opportunities in China’s drug distribution sector. Late last year, Cardinal Health made its first purchase in China, paying a sizeable $470 million to acquire the China drug distribution business of Zuellig Pharma (see story). In the future, Cardinal said it wants to combine organic growth with acquisitions to expand its presence in China.

This week, Cardinal opened a major new logistics center in Shanghai, the biggest in China for the company. The center, which comprises 40,000 square-meters, will serve the Shanghai area.

"We will continue to look for opportunities to expand our footprint here in China," said George Barrett, CEO of Cardinal in an interview with China Daily (see story). "I cannot be really specific on particular targets but I will be very disappointed if, looking back a year from now, we have not already made some acquisitions here," he continued.

In China, Zuellig, known locally as Yong Yu, posted revenues in excess of $1 billion, with sales to 49,000 hospitals and clinics. Before the Zuellig acquisition, Cardinal sourced life science products in the PRC, but was not involved in distribution.

Disclosure: none.