High Technology Acquisitions

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הפקולטה לניהולFACULTY OF MANAGEMENT
בית הספר למוסמכים במינהל עסקיםTHE LEON RECANATI GRADUATE
ע"ש ליאון רקנאטיSCHOOL OF BUSINESS ADMINISTRATION

High-Technology Acquisitions
Final Project -Acquisition Proposal:

To Acquire:

Lecturer: Dr. Nir Brueller
Teaching Assistant: Ms. Shimrit Samuel

Semester B,
April 2012

NameI.D.No.Email
Niran Amir200095362amirnira@gmail.com
Ilan Barak052327632ilanbarak2000@yahoo.com
Uri Gruenbaum035780113gruenbaum.uri@gmail.comBenny Libay026546697bennylibay@gmail.com
Barak Tzachar043414291barak.tzachar@gmail.com‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬

Table of Content

Executive Summary

1.1. Standalone, Synergy and Premium Valuations
*Transaction multiples include premiums
Stand-alone value
Value with synergy
Walkaway
Price
$578,573
$672,772
$528,209
$725,772
$924,841
$580,704
Trading Revenue Multiple
Market Cap
DCF
Trading
EBITDA Multiple
Trans.*
Revenue
Multiple
Trans.*
Revenue
Multiple
$983,490
$1,348,363
Below are variousProtalix'svaluations (thousands, as of April 1, 2012):

Pfizer's Walkway Price is advised to be $983,490 thousand. We believe the DCF best reflects Protalix's value and suggest adding 48%-70% premium over the market price, hence, creating value ranging between $492,149 and $260,980 thousand respectively.

Part 1 - The Rational of the Acquisition
1. Pfizer's Strategy
"We aim to gain leadership positions in key growing therapeutic areas and focus on delivering patient-centric, innovative therapies. We seek strong, long-term relationships that fit our goals and offer a shared vision “ * Company Background: Pfizer is a research-based global pharmaceutical company. The company discovers, develops, manufactures and markets medicines for humans and animals, as well as consumer products. In order To maximize new opportunities in biomedical research, and bring more innovative medicines to more patients more quickly, Pfizer has created two distinct research organizations: 1.) The PharmaTherapeutics Research & Development Group focuses on the discovery of small molecules and related modalities 2.) The BioTherapeutics Research & Development Group focuses on large-molecule research, including vaccines. Pfizer has sites in more than 150 countries around the world. It is divided into two main business segments: pharmaceutical and consumer products. Pfizer has developed an enhanced commercial operating structure and has nine diverse health care business units:

Primary care
Specialty
care
Costumer health care
Emerging Markets

Oncology
Established products

The three other units were recently acquired by other companies (Nutrition- by Nestle, Animal Health and Capsugel -by KKR & CO). Each of these business units is led by an executive with clear accountability for results - from product development following proof of concept to providing access to patients and through to the end of the product's life cycle. With this structure, Pfizer is able to rapidly capitalize on opportunities to advance its business. The company does this by: 1. increasing support for successful new medicines, 2. forging partnerships with key customers, 3. entering co-promotion and licensing agreements, 4. investing in new technologies to add value to its core product offerings, and 5. acquiring new products and services from outside the company. * Strategic goals: Pfizer recently announced a new mission: to become the world’s 'most valued' company. This new mission came about after the old mission set in the 1990s-to lead the pharmaceutical industry, had been achieved. In order to achieve its new mission, Pfizer aims at gaining leadership positions in key growing therapeutic area and focus on delivering patient-centric, innovative therapies. Pfizer plans to do this by expanding its product portfolio, its pipeline and its capabilities in the...
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