In what is being marked as a strategic takeover, the Ireland-based small, specialty pharmaceutical company Warner Chilcott Plc has metamorphosed into an international player - with the $3.1 billion acquisition of the prescription drug business of Procter & Gamble (P&G)!

In a singular deal, financed wholly by bank debt, Warner Chilcott, the maker of women's health and dermatology products, has managed to get a P&G portfolio with $2.3 billion annual sales, including blockbuster osteoporosis drug Actonel, and three times its revenue.

The momentous acquisition will enable Warner gain a notable footing in urology and gastroenterology markets; and spread out into 14 new countries, chiefly in Western Europe. It will also give Warner a 1,200-strong trained sales force and a big research and development team.

Apart from the fact that the banks agreed to finance the full amount of the deal, Warner also had an added edge over other bidders, in the form of lower taxes in Ireland and Puerto Rico. The deal also gives Warner the opportunity of protecting its new drugs from generic competition.

Commenting on the deal, Miller Tabak analyst Les Funtleyder remarked that the acquisition gives Warner an "immediate scale. It gives them an R&D franchise, too. They have five or six years to really get things going, and will have to execute well in order to see longer-term returns."