Aspen Pharmacare (APN) Status update summary

Transaction overview and rationale

• Binding agreements signed to divest 100% of APAC entities and related IP (excluding China) for AUD 2,370 million (ZAR 26.5 billion), with no deferrals or earnouts, at an EV/EBITDA multiple of approximately 11x for FY2025.

• Sale includes entities and assets in Australia, New Zealand, Hong Kong, Malaysia, Taiwan, and the Philippines; net proceeds expected to exceed ZAR 25 billion after costs.

• Proceeds will primarily be used to reduce debt, optimise capital structure, and enhance balance sheet flexibility.

• Transaction completion targeted for end of May 2026, subject to shareholder approval and regulatory clearances.

• Purchaser is BGH Capital Pty Ltd, an Australian private equity firm; transaction initiated following an unsolicited offer.

Financial impact and business mix

• APAC contributed 18% of group revenue (ZAR 7.8 billion) and 26% of EBITDA (ZAR 2,445 million) for FY2025.

• Dilution from the sale is mainly due to the Australian business; group EBITDA margin will see some impact, but post-deal group GP margin should improve.

• Net proceeds will materially lower financing costs, with interest savings expected to exceed ZAR 1 billion.

• No material change in tax rate anticipated; focus remains on deleveraging.

• Day-to-day operations and employment in APAC are intended to continue as normal during the transition.

Strategic focus and growth drivers

• Divestment aligns with strategy to unlock value from sum-of-the-parts, as APAC achieved much of its potential.

• Future growth to be driven by commercial pharma (notably GLP-1s), reshaped sterile manufacturing, and free cash flow generation.

• GLP-1 portfolio (including semaglutide and Mounjaro) expected to be a major growth driver from 2026, with a focus on emerging markets and Canada.

• Manufacturing reshaping is over 90% complete, with progress in insulin and vaccine contracts; targeting EBITDA break-even for sterile manufacturing by FY2027.

• Plans to restore loss-making facilities in South Africa and France to profitability by FY2027 and commercialise new contracts.