After nixing CFR deal, Adcock stakeholders force chairman's resignation

Those who come to power don't usually want their opposition hanging around. That's apparently how South African conglomerate Bidvest feels about Adcock Ingram chairman Khotso Mokhele, who last year rebuffed a Bidvest takeover offer, labeling it "opportunistic." Now, after teaming up to block Adcock's deal with Chile's CFR Pharmaceuticals, the two companies have forced his resignation.

As South Africa's BDlive reports, Mokhele stepped down Wednesday after Adcock received identical letters from Bidvest and PIC, which together own more than 55% of the company's stock. Along with Mokhele's resignation, the letters also called for the board to appoint Bidvest CEO Brian Joffe and three others to Adcock's board.

The news pleased investors, who sent shares up as much as 3.5% to 58.61 rand ($5.35). "The resignation is definitely seen as positive," Avior Research analyst Mathew Menezes told Bloomberg. "It shows that Bidvest is getting involved early to bring change in the company."

But while Bidvest, the owner of catering and car businesses, has a reputation for turning struggling companies around, it won't be exactly the kind of change Adcock asked for when it pleaded that a merger was essential for survival in the worldwide pharmaceutical landscape. "The continuing consolidation of the global pharmaceutical market has again challenged the long-term sustainability of Adcock Ingram's business," the company said in a November statement.

Unfortunately for CFR, Bidvest and PIC didn't see things quite the same way. While the Chilean company's CEO, Alejandro Weinstein, made numerous attempts to seal the deal--including traveling to South Africa and putting forth a sweetened bid--Bidvest and PIC weren't interested, upping their stakes until the deal was thwarted.

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