From the Chicago suburbs to the streets of Brussels, Abbott Laboratories’ €4.5bn cash acquisition of Solvay’s drugs business is the latest big pharmaceuticals deal. Stuck inside a chemicals and plastics company 30 per cent owned by its eponymous founding family, Solvay’s drugs unit lacks the scale necessary to compete head-to-head with bigger European rivals. Its best-selling drug, the TriCor cholesterol treatment, sold in partnership with Abbott, faces a threat from generic competition as of 2011. Operating margins of about 18 per cent are also below the 25 per cent typical of a speciality pharma company.

So what does Abbott see in the business? Earnings, for one. Abbott predicts the deal will increase earnings by 10 cents a share next year. Abbott will also gain better access to overseas markets. Less than half Abbott’s sales were outside North America last year, compared with 60 per cent at Solvay.