Please login to the form below

Not currently logged in
Email:
Password:

Schering turns down Merck offer

Board says bid to create biggest German pharma firm 'significantly undervalues company'

 
Von Eschenbach in running for permanent FDA job
NHS trusts to face tougher ratings tests
 
Pharma news in brief
NHS news in brief
R&D news in brief
Schering has rejected a Ä14.6bn unsolicited takeover offer from rival Merck KGaA, increasing speculation that the German pharmaceutical sector is about to witness a bidding war.

As Schering's share price rose on investor speculation that Merck's bid would be sweetened, Schering chief executive Hubertus Erlen insisted that his company had no reason to join up with another.

Family-controlled Merck has confirmed that it made an offer of Ä77-a-share, a 15.4 per cent premium to Schering's closing share price on Friday (March 10).

ìGermany was once known as the pharmacy of the world,î said Jon Baumhauer, who represents the Merck family's 73 per cent stake on the group's board. ìThis deal would again bring us to the front of the international pharmaceutical industry.î

Erlen said the board had been informed of the offer at the weekend and had decided that it ìsignificantly undervalues the companyî.

ìWe looked at it and found that we had better prospects as an independent specialised company,î he said. ìShould the offer still come, we will not be able to recommend it to our shareholders.î

The head of Schering's supervisory board, Giuseppe Vita told reporters he expected a ìwhite knightî to launch a counter-bid, without naming any potential candidates.

A deal between Merck and Schering, two midsize companies, would create a significant European player, with annual sales of more than Ä11bn. Consolidation in the German pharma sector has been on hold since Hoechst merged with France's Rhone-Poulenc in 1998 to form Aventis in 1998.

Merck's move for Schering appears to be fuelled by its desire to boost its branded drug portfolio. While its best known product is cancer drug Erbitux, in recent years its chemicals division has overshadowed its pharmaceuticals unit, mainly thanks to sales of liquid crystals.

A merger with Schering would also beef up Merck's small presence in North America and Japan.

In November, Bernhard Scheuble stepped down as chief executive of Merck, after mounting tension with the company's owners over its future direction. He was replaced by Michael RÙmer, who vowed not to change Merck's strategy.

Schering is the world's biggest manufacturer of oral contraceptives, including the top-selling birth control pill, Yasmin. It also sells Betaferon for multiple sclerosis.

30th September 2008

Share

COVID-19 Updates and Daily News

Featured jobs

PMHub

Add my company
CSafe Global

CSafe Global is the only global provider of a full line of cold chain solutions and is the world’s largest...

Latest intelligence

DEMAND DIVERSITY REPORT 02: Why is the LGBTQ+ community facing poorer health outcomes due to COVID-19?
We’re all aware that clinical trials have been discussed more widely since the COVID-19 pandemic. While that’s a great thing for raising awareness of clinical trials in general, it’s also...
CHECKLIST 04: Let’s make your patient recruitment strategies a success
From how to generate insights to define your audience to drilling down those all-important key messages, our checklist has everything you need to think of, covered....
Multichannel engagement and the need for greater understanding of European markets
By Laurence Olding and Georgina James...

Infographics