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Celesio seeks new Russian partner, Protek deal off
Germany's Celesio is seeking a new partner in Russia after months of negotiations to buy a majority stake in Protek Holding has yielded no results, Europe's biggest drug distributor said on Friday.
Celesio had hoped to use Protek to expand into the fast-growing Russian market, under a plan announced in October.
"Celesio will hold discussions with other potential partners," the company said in a statement.
Celesio shares held their gains after the news, up 2.2 percent at 40.13 euros at 1015 GMT, compared with a 1.7 percent gain in the German midcap index .
Protek -- a vertically integrated group that includes drug manufacturing, retail and distribution -- had revenue of $2.4 billion in 2006.
It has nearly a quarter of the drug distribution market in Russia and owns the country's second-biggest pharmacy chain with 630 pharmacies that generated sales of about $250 million.
Celesio has little exposure in eastern European markets.
Like German generics drug maker Stada (STAGn.DE: Quote, Profile, Research), Celesio has been faced with tough German government measures to cut healthcare costs in what is Europe's biggest drug market. Both firms are facing margin pressures.
To counter this, Stada had snapped up Serbian drugmaker Hemofarm and is acquiring Russian drug group Makiz.