Alcon minorities may get higher Novartis bid

Novartis (NYSE:NVS) doesn't just have to worry about Alcon's (NYSE:ACL) balky independent directors as it works to buy out the eye-care company's minority investors. Alcon employees should be a big stumbling block, too, the Financial Times points out.

The Swiss drugmaker has been on the slow road to buying out Alcon since 2008, when it purchased part of Nestle's stake in the company. Next came the rest of Nestle's 77 percent stake. Now, the only holdouts are the company's minority investors, and Novartis has made an offer to buy them out, too--an offer somewhat lower than what it paid for Nestle's shares. Alcon's independent directors are fighting tenaciously for more money.

But Alcon employees are another piece of the minority-buyout puzzle. That's because staffers own about 9 percent of Alcon's shares; in fact, one-third of the minority shares are owned by company employees. Leaving them with a lowball buyout offer could be bad for morale, the FT reports.

Sources close to the deal aren't moved by the morale issue. "We understand that's an absolutely critical part," a Novartis adviser tells the FT. "But why do we have to pay a lot of money to the other 15 percent minority shareholders? There are more direct ways of rewarding employees." Nonetheless, Novartis CEO Joe Jiminez (photo) won't rule out an increased bid for the minority shares, and analysts see signs of a negotiated deal ahead.

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