Dechra Pharmaceuticals is acquiring 63.3% of Genera, a Croatia-listed animal health business, for €23.66 a share. Genera has a strong presence in farm animal products in the region, although the primary appeal is its growing expertise in vaccines, particularly in poultry. Although the deal is expected to be earnings neutral for the first two years, with enhancement thereafter, the strategic rationale is compelling. The €51.4m price will be paid in cash and funded from existing debt facilities. Our forecasts and valuation are under review pending completion of the deal in November.