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Chile's CFR Slightly Sweetens Adcock Offer To Win PIC Backing
A worker at Kalbe Farma's factory holds up a handful of tablets in Cikarang, on the outskirt of Jakarta, May 8, 2013. PHOTO BY REUTERS/Enny Nuraheni
By Tiisetso Motsoeneng
14/12/2013
JOHANNESBURG (Reuters) - Chile's CFR Pharmaceuticals slightly sweetened its takeover offer for South African drugmaker Adcock Ingram to 12.8 billion rand in cash and stock on Friday, an attempt to win backing from the top shareholder.
The fate of the rare Chile-South Africa tie-up has been in doubt after Adcock's largest shareholder, state-owned Public Investment Corp (PIC), rejected the bid and local firm Bidvest launched a counter offer.
Bidvest, a sprawling conglomerate whose businesses include car sales and catering, has offered 4 billion rand in cash for more than a third of Adcock, South Africa's second-largest drugmaker.
"We are quite confident that the new offer would satisfy the requirements of the PIC," CFR Chief Executive Alejandro Weinstein told reporters on a conference call, adding it had not yet approached PIC with the revised offer.
Santiago-based CFR initially offered 12.6 billion rand in cash and shares, a bid PIC would have "probably" approved if it were all in cash, a source familiar with the fund's thinking has told Reuters.
Under the revised CFR offer, shareholders would receive 74.50 rand worth of cash and shares for each Adcock share, based on a value of 2.334 rand per new CFR share. That is slightly higher than the 73.51 rand per share CFR offered last month.
The final ratio of cash to shares will only be determined after a pending rights issue by CFR.
The new offer is also aimed at fending off Bidvest, which went to straight to shareholders with a 70 rand per share cash offer earlier this month.
Bidvest has already built up its Adcock stake to about 7 percent, enough to torpedo the deal if PIC - which owns about 19 percent - is still not in favour of the revised offer.
The deal needs backing by shareholders holding 75 percent of Adcock to go through.
No-one at PIC was immediately available to comment
Shares in Adcock hardly moved on the news. By 1439 GMT, the stock was up 0.8 percent at 70.60 rand, a discount to the value of the bid which reflected uncertainty about its fate.
The meeting where shareholders were due to vote on the CFR offer has been postponed from December 18 and would now be held by no later than January 15th, Adcock and CFR said in a statement.
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