No one made an offer Warner Chilcott ($WCRX) couldn't refuse. So the Irish drugmaker says it's not selling itself after all. Instead, it will spend $1 billion on a $4-per-share dividend, presumably as a consolation prize for shareholders.
The drugmaker hired Goldman Sachs in April to "explore strategic options," including a sale. And bidders did come forward, Reuters sources said. Warner Chilcott received offers from three potential buyers, both private equity investors and pharma industry types. But none of them met the company's expectations. And those expectations were in the mid-$20s per share.
Warner Chilcott has been down the private equity path before. As Bloomberg notes, investment firms took the company private in 2005 for about £1.6 billion ($2.1 billion): Bain Capital, Thomas H. Lee Partners and the buyout units of JP Morgan Chase and Credit Suisse. In 2006, they took it public again. Credit Suisse sold its stake in 2010. Reuters says the private equity players still own about 30% of the company.
It's also familiar with the special dividend strategy, Bloomberg notes. The company paid a special dividend of $8.50 per share in 2010. So, the latest payout wasn't much of a surprise to ThinkEquity analyst James Molloy. "It's certainly a play they've used before," he told the news service.
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