In a major setback,
) announced that it has failed to obtain the mandatory 75% stake
for the successful completion of the previously announced
acquisition of Germany-based Celesio.
McKesson launched a public takeover offer for the outstanding
shares of Celesio in Dec 2013. Last week, McKesson upped its
offer to €23.50 per share from €23.00 per share for a 50.01%
stake in Celesio.
The increase in offer price was expected as it was reported
that hedge fund Elliot Associates, which holds approximately 25%
of shares in Celesio, indicated that the offer price of €23 per
share grossly undervalues Celesio's worth.
The offer price of €23.50 was the final offer from McKesson.
The acquisition was conditional upon regulatory approvals along
with McKesson obtaining a 75% stake in Celesio.
Investors were clearly disappointed as shares were down 4.73%
on the news.
We remind investors that McKesson announced in Oct 2013 that
it has signed an agreement with Franz Haniel & Cie. GmbH, the
largest shareholder in Celesio, to acquire a majority stake in
Celesio for approximately €23 per share or $8.3 billion. Elliot
Associates were reportedly opposing the acquisition
We are disappointed with the setback. Celesio provides
logistics and services in the pharmaceutical and healthcare
sector with operations in approximately 14 countries. The
acquisition would have allowed McKesson to gain a solid foothold
in Europe, thereby geographically expanding its core operations
McKesson currently carries a Zacks Rank #2 (Buy). Other stocks
that currently look attractive include
Align Technology Inc
). While Cardinal Health and Align Technology carry a Zacks Rank
#1 (Strong Buy), Herbalife holds a Zacks Rank #2 (Buy).
ALIGN TECH INC (ALGN): Free Stock Analysis
CARDINAL HEALTH (CAH): Free Stock Analysis
HERBALIFE LTD (HLF): Free Stock Analysis
MCKESSON CORP (MCK): Free Stock Analysis
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