Stirling snaps up Canadian drug manufacturing plant for a song

Human and animal health company, Stirling Products, has snapped up a bargain in the form of a near new state-of-the-art pharmaceutical manufacturing facility located in Cape Breton in Canada for less than a fifth its estimated value.

The facility comprises a 985 square metre (10,600 square feet) two-storey, fully insulated and temperature and atmosphere controlled drug manufacturing plant built on 2 hectares (5 acres) of freehold land.

It is fitted out with extensive laboratory and drug manufacturing and packaging facilities. Features include the a fully fitted out laboratory, water filtration systems, auto mixing units ranging to 3,000 kg capacity and two fully automated filling, labelling and packaging lines.

With the current fit-out and configuration the plant, which is fully cGMP compliant, has an annual capacity to manufacture and package over 550 million tablets, 5 million bottles and blend up to 1.5 million kg of product. It also has a granulating and grinding capacity.

Stirling has agreed to pay a total of CAN$3.6 million over a span of 30 months for the facility, which is estimated to have a replacement value of $20 million.

The facility came up for sale as a major Canadian pharmaceutical group and its institutional lender were hit by the GFC.

"The acquisition of this facility on the purchase terms negotiated represents an extraordinary opportunity for the Company," said Stirling Products managing director Mr Peter Boonen.

"The acquisition also signifcantly adds to the growing tangible asset base of the Company. Importantly however, it will provide for commercially sensitive product development to be carried out under the Company’s exclusive control as well as forming a key cornerstone of our ongoing strategic growth in the global pharmaceutical, generics and healthcare markets."