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Catalent Stock Rises on $1B Deal to Buy Supplements Maker Bettera

Bettera will 'complement and accelerate the growth of Catalent’s global soft-gel and oral dose formulation and manufacturing,' Catalent said.
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Catalent  (CTLT) - Get Catalent Inc Report shares rose Monday, after the contract drug maker said it’s buying Bettera, a gummy nutritional supplements maker, for $1 billion in cash.

Bettera is backed by the Dallas investment firm Highlander Partners. Catalent is the Somerset, N.J., pharmaceutical technology company.

The deal “will complement and accelerate the growth of Catalent’s global soft-gel and oral dose formulation and manufacturing business,” Catalent said.

Catalent recently traded at $133.40, up 3%. It rose 12% in the six months through Friday.

Gummy vitamins and supplements are all the rage now. An Allied Market Research report last year estimated gummy sales will hit $9.3 billion by 2026, up from $5.7 billion in 2018, The Wall Street Journal reports.

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Catalent expects the acquisition to close before year-end. Catalent will finance the deal with a combination of cash on hand, existing credit facilities and, depending on market conditions, new debt financing.

Catalent released earnings Monday for the fiscal 2021 fourth quarter ended June 30.

Revenue registered $1.19 billion, up 25%, or 22% in constant currency, from $947 million in the fourth quarter a year ago. Overall organic net revenue climbed 26%.

Net income totaled 98 cents a basic share, compared 86 cents in the fourth quarter a year ago.

Ebitda from operations was $326 million, an increase of $60 million from $266 million in the fourth quarter a year ago.

Adjusted net income was $1.16 a share, compared with 90 cents a year earlier.