PRGO - Perrigo to invest $170M to expand baby formula manufacturing buys Nestlé Gateway plant

• Perrigo ( NYSE: PRGO ) said Tuesday it will invest $170M to expand its U.S. baby formula manufacturing, which will include the purchase of Nestlé's ( OTCPK:NSRGY ) Gateway plant and investment to scale up production capacity at the facility.
• Perrigo ( PRGO ) bought the Gateway plant in Eau Claire, Wisconsin, as well as the U.S. and Canadian rights to the Good Start formula brand.
• The company will immediately invest $60M to expand Gateway's 29M lbs per year production capacity by 7M lbs within 18 months, adding 36M lbs of capacity to Perrigo ( PRGO ).
• The firm expects the purchase of the Gateway plant, along with the U.S. and Canadian rights to Good Start, to be immediately accretive to net sales, gross margin and EPS.
• The deal was funded without additional borrowings and does not impact Perrigo's ( PRGO ) plan to reduce debt over the next three years.

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