MAXTON — The world’s largest animal health company, Zoetis, is selling a poultry vaccine and the Maxton plant that makes it, to Huvepharma, an animal health company based in Bulgaria.
Employees at the plant — located at the Laurinburg-Maxton Airbase — will become employees of Huvepharma, the company said in a news release announcing the sale.
The North Carolina purchase is part of Huvepharma’s larger acquisition of medicated feed additives, water-soluble veterinary products, animal pharmaceuticals and two manufacturing plants in Arkansas and Colorado. The $40 million cash deal is expected to close in the first quarter of 2016.
“This acquisition advances Huvepharma’s strategy in the animal health market and further strengthens our current portfolio of products,” said Glen Wilkinson, Huvepharma USA president. “It is yet another milestone for our company and we look forward to integrating the products and production sites so we can realize the value these additions will produce for Huvepharma and our customers worldwide.”
The Scotland County plant produces Inovocox EM1, a vaccine that protects broiler chicks against coccidiosis, a parasitic disease of the intestinal tract caused by coccidian protozoa. A Zoetis spokesman reached would not disclose the number of people currently employed at the plant located on Skyway Church Road in Maxton. Reports online list the number of emplyees between 200 and 500.
The plant was built in 2004 by Embrex, a 1985 startup company in Research Triangle Park that developed poultry vaccines and invented a high-speed system, Inovoject, for injecting vaccines into chicken and turkey eggs. The system transformed poultry production by automating inoculations that previously had been given to newborn chicks by hand.
Embrex became publicly traded in 1991 and was sold in 2006 to Pfizer Animal Health, a division of Pfizer Inc., for $155 million.
Pfizer spun off the animal health business in 2013 as Zoetis, a fully independent company that raised $2.2 billion in an initial public offering of stock.
The sale of assets by Zoetis is part of the company’s plan to cut costs and improve operating margins in response to shareholder pressure to improve its stock price. Zoetis said it would sell or close 10 manufacturing plants and lay off about 25 percent of its global workforce, roughly 2,500 jobs.
The products to be divested under the Agreement represent a portion of the lower-revenue, lower-margin product stock keeping units that Zoetis expects to eliminate to help improve profitability and enhance the reliability and efficiency of the Zoetis supply network.
The Zoetis acquisition “reinforces and builds upon our commitment to our customers in providing high-quality products for livestock, produced in our EU- and USA-based facilities,” said Kiril Domuschiev, president and owner of Huvepharma. “We are satisfied that the strong brands associated with these assets will continue to strengthen our position in key markets and reinforce our growth potential.”
Huvepharma is a global animal health company headquartered in Sofia, Bulgaria, with product sales in more than 90 countries. The privately owned company markets products used in swine, poultry and cattle production.