Chiron says Novartis' $4.5 billion offer for remaining shares 'inadequate'

By Jennifer Chiou

New York, Sept. 6 - Chiron Corp. said the $40.00 per share or $4.5 billion offer for its remaining 112 million shares from Novartis AG is "inadequate," according to a statement from the company.

The remaining shares represent 58% of Chiron, which received the offer on Sept. 1. The $40.00 per share figure represents a 12% premium to Chiron's one week weighted average closing price, Novartis had said.

In a response to Novartis, the Emeryville, Calif., biopharmaceutical company said: "After thorough analysis and consideration of Novartis' offer to acquire the shares of Chiron it does not already own for $40.00 per share in cash, the independent directors of Chiron have determined that this offer is inadequate."

In its statement, Chiron noted its established relationship with Novartis: "Over the 10 years since Novartis has been Chiron's largest stockholder, Chiron has regularly discussed with Novartis a number of strategic initiatives, including mergers, significant acquisitions and other transactions, including transactions initiated by Novartis.

"As a result, Chiron has had an ongoing dialogue with Novartis regarding its intentions with respect to its investment in Chiron. Chiron's independent directors have not, however, solicited an offer to buy Chiron."

As preciously reported, in a letter to the independent directors, Novartis chairman and chief executive officer Daniel Vasella said the company was making the bid to "best protect" its investment in Chiron, adding that as a subsidiary of Novartis, Chiron would be "better positioned to deal with the legal, regulatory and business issues that it is facing."

Novartis is a Basel, Switzerland, pharmaceutical company that owns 42.2% of Chiron.

Morgan Stanley and Credit Suisse First Boston advised Chiron's independent directors.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.