Novartis vs. Alcon
In 2009, Novartis began its takeover, buying a portion of Nestle's stake in the company, before rolling out phase II early in 2010. The total deal would cost the company an approximate $49.8 billion. But while Nestle, the former majority Alcon shareholder, received a sweet deal, the remaining 23 percent of shareholders were looking at a much smaller payout. Stock prices had plummeted 18 percent since the original purchase. Looking to save some money, Novartis argued it was within its legal parameters with the lower buyout; once the company owns Nestle's entire 77 percent share of Alcon, it could force the deal among its minority shareholders.
In retaliation, the shareholders filed a class action lawsuit in January 2010, with support from Alcon's board. The independent director committee has set aside more than $50 million for legal fees associated with the Novartis battle, which some experts believe the plaintiffs can win.
Although Novartis has officially wrapped up its two-stage buyout, getting that 77 percent stake from Nestle, it still wants the outlying 23 percent. Novartis CEO Joe Jimenez (photo) recently said his company is sticking to its offer for the minority shareholders, which it has described as "full and fair." He added that even though his company had not been able to reach common ground with the Alcon board over the value of the stake, Novartis is "not in a hurry," Reuters notes.