Aspen’s R6.5bn sale of its Japanese operations to Swiss drugmaker Sandoz is a further step in group chief executive Stephen Saad’s plan to hone the once mainly generics business into a global specialist in anaesthetics and thrombosis drugs. But the division’s p:e ratio of about 14 also implies that the market is still undervaluing Aspen as a whole, though its shares have clawed their way back above R120 this week. The FM asked Saad whether the company’s debt — R38.9bn at the end of June — was also a consideration.

Nothing we have done is to deal with debt — we would like to deleverage but we’ve got to focus and drive organic growth. What we have found is that our model works very well in most emerging markets because there’s volume growth. It’s important to us for our facilities and also it drives turnover. Japan is a big market but — and you’ve seen it in our results — it has unilateral price decreases so every year you have a price decrease...

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