Impatient Bidvest prods Adcock for a deal as tussle with rival bidder escalates

South African conglomerate Bidvest Group wants the fight over Adcock Ingram to wrap up already. CEO Brian Joffe said Bidvest has again hiked its stake in Adcock--to 9%--and that he will close his takeover offer early next month.

As one of Adcock's top shareholders now, Bidvest is aiming to thwart a takeover by Chile-based CFR Pharmaceuticals by buying a bigger stake in the company. But the Chilean drugmaker appears pretty determined to thwart Bidvest, too. Its shareholders recently approved a sweetened offer for Adcock, which CFR needs to build up its presence in Africa and other emerging markets.

The Bidvest-CFR wrestling match is just part of the wrangling over Adcock Ingram. One key shareholder, the South African government-affiliated fund Public Investment Corp. (PIC), has thrown its weight against the CFR deal, which is a cash-and-stock offer. PIC says CFR's shares are overvalued and takes issue with the stock portion of the deal.

Market-watchers say PIC also worries about foreign ownership of Adcock, though the fund hasn't said so publicly. The drugmaker is one of the country's top pharma companies, and drug supplies might be more secure if it remains in domestic hands, or so the theory goes.

Amid all this turmoil, Adcock has delayed a shareholder vote on the CFR deal a couple of times. Management wants to make the deal, considering the heft needed for drugmakers to compete in a global market. Now, the vote is likely to take place in mid-February, Reuters says. Bidvest, which is complaining of "continuous delays," says its 70-rand-per-share, all-cash offer for 34.5% of Adcock will close Feb. 4. In other words, get on with it.

"[Joffe] wants to get it done sooner rather than later, and either move forward and get the business into the shape he can get it into or else move on," Nic Norman-Smith, chief investment officer at Lentus Asset Management, told Reuters. "Putting people on terms is never a bad thing. I don't think it is beneficial for any of the parties for it to drag on."

- see the Reuters news

Special Reports: Top Biopharma M&A deals of 2012 | Top 10 Drugmakers in Emerging Markets

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