German generic drugmaker Stada accepts Bain and Cinven's €5.32 bn takeover offer
10 April 2017
German generic drugmaker Stada Arzneimittel AG (Stada) yesterday said that it has decided to back private equity firms Bain Capital and Cinven Partners €5.32 billion takeover offer.
Last month, Stada said that it has received two takeover offers including a €3.5-billion ($3.83 billion) bid from private equity firm Cinven. (See: German generic drugmaker Stada receives $3.83-bn takeover bid from Cinven Partners)
''STADA Arzneimittel AG confirms that it has received two legally non-binding expressions of interest regarding a bid for the acquisition of up to 100 percent of the shares in the Company, one of which is from Cinven Partners LLP at an indicative takeover price of Euro 56.00 per STADA share,'' the Bad Vilbel, Germany-based company had then said in a statement.
Stada said that following a careful review, its board has decided to support the offer by Bain Capital and Cinven.
Bain Capital and Cinven have offered to pay €65.28 plus a dividend of €0.72 per share, a 48.9 per cent premium in relation to Stada's unaffected share price and an approximately 19.6 per cent premium to the company's average share price over the last three months.
Stada, Bain and Cinven have signed an investor agreement with extensive protection provisions for employees and production sites as well as the corporate strategy.
Bain and Cinven have agreed to refrain from forced redundancies for four years and not move the company's headquarters and key business sites.
''Our negotiating strategy over the last few weeks was very successful: We are very pleased that we have been able to increase the transaction value from approximately Euro 4.7 billion to more than Euro 5.3 billion by Euro 7.28 per share and have now reached the best offer for our shareholders'', said Ferdinand Oetker, chairman of Stada, in a statement.
''The offer of Bain Capital and Cinven contains the most attractive overall combination. In addition to the highest price we were able to reach comprehensive protection provisions especially for our employees and to initiate a future-oriented growth strategy,'' he added.
German activist investor Active Ownership Capital, with a 7-per cent stake, has been in a year-long effort to improve Stada's profitability and was able to oust the company's chairman during annual meeting late last year.
Founded in Dresden in 1895 as a cooperative pharmacy, Stada specialises in the production of generic and over-the-counter drugs.
Stada has expanded internationally since 1986 by buying companies in Austria, Denmark, Switzerland, Spain, Italy, Britain, Russia Serbia, Portugal, and Asia.
Generics generate 58 per cent while branded products 40 per cent of the company's annual sales of €2.16 billion.