Join, Follow & Connect
Join Modern Healthcare's LinkedIn group Follow Modern Healthcare on Twitter Join Modern Healthcare's Facebook group Follow Modern Healthcare's Pinterest board Modern Healthcare's Flickr page Modern Healthcare's YouTube Channel Get a Modern Healthcare news feed

 
Comment Buy Reprints Print Article Share on LinkedIn Share on Facebook Share on Twitter Email this page to a colleague
Healthcare Business News
 
Hammergren
Hammergren

McKesson to acquire Celesio after third bid revives deal


By Rachel Landen
Posted: January 23, 2014 - 6:45 pm ET
Tags:

McKesson Corp. revived its bid to acquire German drug distributor Celesio after a failed tender offer only 10 days earlier.

Under an agreement announced Thursday just after the markets closed, McKesson will buy all the stock held by Celesio's majority owner, Franz Haniel & Cie., for its previous bid of 23.5 euros per share. McKesson separately agreed to buy convertible bonds from hedge fund Elliott Management Corp., Celesio's second largest shareholder. The two deals are enough to push McKesson over the 75% ownership threshold needed to acquire Celesio under German law.

Advertisement | View Media Kit

 

“We are excited to move forward with our acquisition of Celesio,” McKesson CEO John Hammergren said in a news release. “We look forward to bringing together the strengths of the McKesson and Celesio organizations so we can provide our customers with more efficient delivery of healthcare products and services around the world.”

The San Francisco-based drug distributor originally offered to buy Celesio for 23 euros a share, or about 6.1 billion euros ($8.3 billion), including debt, last October. When Elliott rejected the bid as too low, McKesson countered with what it called its “best and final offer” of 23.5 euros a share, or about 6.2 billion euros ($8.4 billion). Though Haniel accepted the higher bid, it wasn't enough to convince Elliott and the remaining smaller investors to tender all of their shares and complete the deal in mid-January.

After the deal failed, Hammergren told reporters and analysts at the JPMorgan Healthcare Conference in San Francisco that if McKesson could “put a deal back together at the same economics, then (they) might be open to it.”

McKesson expected to close the transaction within the next 10 business days using cash and a temporary bridge loan. The company is scheduled to announce its third-quarter financial results next week and will consolidate Celesio's results during its fourth quarter, which ends March 31.

Follow Rachel Landen on Twitter: @MHrlanden


What do you think?

Share your opinion. Send a letter to the Editor or Post a comment below.

Post a comment

Loading Comments Loading comments...

Search ModernHealthcare.com:


 

Switch to the new Modern Healthcare Daily News app

For the best experience of ModernHealthcare.com on your iPad, switch to the new Modern Healthcare app — it's optimized for your device but there is no need to download.