Proxy fight survivor Stada entertains suitors for potential $3.7B buyout

Stada
The German drugmaker Stada is weighing buyout interest from two bidders, including London-based private equity player Cinven.

Last year, Stada reportedly weighed a buyout to dodge the demands of an activist shareholder. Now, nearly six months after touting a proxy battle victory, it’s weighing offers—and this time may find itself at the center of a bidding war.

The German drugmaker said Monday that it's striking up "open-minded talks" with two private-equity firms looking to swallow it whole: London-based Cinven and Boston's Advent International. 

Each firm "could offer in different ways attractive opportunities in the interest of the company," Stada said in a statement. Talks will "allow the interested parties to explain their strategic concepts and evaluate further value-enhancing potential with regards to the potential offer price."

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The company noted in a previous statement that Cinven is offering up €56 per Stada share. 

It hasn’t been long since Stada and its wannabe owners last talked M&A. The company and private equity firm CVC Capital Partners held informal takeover talks on a deal worth up to €3.7 billion, The Wall Street Journal reported last May. Other private equity outfits got in touch with Stada around that time, too.

The catalyst? Activist pressure from Active Ownership Capital, which in August scored a seat on Stada’s board after ousting then-chairman Martin Abend. Stada managed to regain control of the company by installing four of its own new director picks, but that didn’t stop AOC from touting its progress as a “victory for shareholder democracy.”

As a potential buyer this time around, Cinven brings some experience in the pharma business. Stada would be just the latest in a string of generics deals. In 2012, it nabbed Mercury Pharma and Amdipharm, and then merged the two and sold the combo to serial buyer Concordia Healthcare.

At least one shareholder likely wishes Stada had stuck by the option to sell before the board reshuffling, though. “Why wait five years instead of selling in five months?” U.S.-based rebel shareholder Guy Wyser-Pratte asked Reuters last summer.

Editor's note: This story has been updated to include information from Stada's Monday statement.

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