Alcon in hand, Novartis zeroes in on minority stake

Novartis is moving full speed ahead in its bid to buy out Alcon's minority shareholders--in spite of the eye care company's fractious independent directors. Those directors have been fighting for a higher price--and threatening legal action if they don't get it.

Novartis has officially wrapped up its two-stage buyout of Alcon, in which it acquired a 77 percent stake from Nestle. It now not only holds controlling interest, but has a majority on Alcon's board. But it still wants that outlying 23 percent, and so far has remained unwilling to sweeten its bid from the current share-swap offer valued at $153 per share (Nestle got $168).

Both parties think they have the law on their sides. Novartis says Swiss law will allow it to push the minority buyout through, Reuters reports. But Alcon's independent director committee has an expert opinion stating that the law requires its approval for the deal. When Novartis announced it had closed the Alcon transaction, the IDC lost no time in issuing a statement reiterating its threats to sue.

Analysts still think Novartis will end up boosting its bid; Vontobel's Andrew Weiss tells Reuters that the drugmaker "will ultimately have to improve its offer, probably to around $165 per share."

- read the IDC release
- see the Reuters news
- get more from the Wall Street Journal

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