Chilean drugmaker makes R13bn Adock offer
Published
A pharmacist counts pills in a pharmacy. File image: Reuters A pharmacist counts pills in a pharmacy. File image: Reuters
Johannesburg - Adcock Ingram said it received a non-binding bid from Chilean drugmaker CFR Pharmaceuticals SA that values South Africa’s largest supplier of hospital products at 12.9 billion rand ($1.3 billion).
The potential offer price from CFR is 73.51 rand, 14 percent more than Adcock’s closing price of 64.50 rand yesterday, Johannesburg-based Adcock said in a statement today.
CFR would pay in cash and stock, the South African company said.
“This offer has a compelling rationale from an emerging market point of view,” Andrew Thompson, an independent director at Adcock, said in a phone interview.
“There is no other South African company that could have offered this combination.”
A combination with CFR, Chile’s largest drugmaker, would create a company with annual revenue of about $1.3 billion and an asset base of approximately $2.1 billion, Adcock said.
It would have a presence in more than 23 countries and employ more than 10,000 people.
Adcock rose as much as 6.4 percent to 68.60 rand and traded 2.7 percent higher at 9:49 a.m. in Johannesburg.
The stock has gained 6.9 percent since May 8, the day before the company said it had received more than one non-binding proposal that could lead to an offer for all stock or a controlling stake.
Investor’s Stance
The Public Investment Corporation, the South African government- employee pension-fund manager that’s Adcock’s biggest shareholder, said May 14 that it would prefer that a domestic company buy the hospital-supply provider.
CFR, based in Santiago, bought Laboratorio Franco Colombiano Lafrancol SAS in December for an undisclosed amount, giving the company what it said would be the biggest share of the market in Colombia.
In March, Bidvest Group Ltd., which operates businesses from cleaning and car sales to coal-export terminals, offered to pay about 6.2 billion rand to buy a 60 percent stake in Adcock.
The medical-supply company rejected the bid.
A spokesmen for Bidvest, which said in May that it’s still interested in Adcock, didn’t immediately reply to an e-mail seeking comment today. - Bloomberg News