Warner Chilcott agrees to takeover
Shares in the Craigavon-based pharmaceutical rose 4% after the company recommended an offer of £8.62 per share to shareholders. The new deal, tabled by a special purpose company formed by private equity groups from JP Morgan and DLJ Merchant Banking Partners, trumped the £8.37 offer from an unidentified bidder that was announced on Tuesday.
The offer includes a dividend payment of 3p per share, which the company had declared but not yet paid.
Three potential buyers had circled the company in recent weeks, driving up the share price more than 30% in anticipation of a bidding war.
The other groups were headed by investment banking giant Goldman Sachs and American private equity firm Bain Capital. Executive chairman John King said the proposed takeover was attractive and reflected the group's strong position in women's healthcare products.
Dr King said Waren, the company making the bid, would develop Warner Chilcott's business and build on its success in America, which accounts for over 90% of the company's revenues.
The company's board recommended the bid unanimously, with the exception of chief executive Roger Boisseaneault, who absented himself from the board's discussions.
It will pay £17 million to Waren if the transaction fails to go ahead, to compensate it for costs involved in preparing the bid.
In a separate announcement, the company announced full-year operating profits of $272 million (€212 million) for the year to September, a 45% increase on last year.
Revenues were 21% ahead at $523 million, but sales excluding discontinued operations were 42% higher at $464 million. Earnings per share went up 31% to 112c.
The group reported strong progress in sales of its core products, which include oral contraceptives, hormone replacement therapies and treatments for skin conditions.
Selling, general and administrative costs in the past three months of the year fell almost 20% to $35.8 million, fuelling an improvement in gross margins, which climbed from 85% to 87%.
