AstraZeneca PLC (LSE:AZN)’s £780 million takeover of France-based Amolyt Pharma on Thursday failed to tempt much of a reaction from Deutsche Bank analysts.
According to the bank, the acquisition “is sufficiently modest to pass under the radar without any visible impact on leverage or profit and losses”.
Indeed, net debt and pre-tax earnings came in at US$22.5 billion and US$13.6 billion over the last full year respectively, Deutsche noted.
Deutsche reiterated a ‘sell’ rating for AstraZeneca as a result, with a share price target of 9,500p marking a prospective 8% fall on Thursday’s closing value.
That said, the acquisition could hint to a wider plan by AstraZeneca to expand into rare diseases, analysts said, given Amolyt’s lead treatment for hyperparathyroidism.
“[The acquisition] is of note for signalling an intent to keep building out the rare disease business portfolio and maintaining a fairly diverse spread of business development activity,” Deutsche added.
However, such intentions “certainly look likely to remain a drag on cash generation,” the bank warned.