Schering-Plough buys firm for €11bn
The move allows Schering-Plough to gain the world’s third-largest maker of birth-control pills and its stable of experimental medicines and provide a steadily growing base of products and businesses with sales of nearly $5bn.
Organon’s trials include medicines for schizophrenia, bipolar disorders, neuromuscular blockages, contraception, infertility, insomnia and hot flashes in menopausal women.
The transaction is due to close by the end of the year and will boost its earnings per share by about 10 cents in the first year, excluding purchase-accounting adjustments and acquisition-related costs.
Schering-Plough chief executive Fred Hassan said: “It builds on our growing strength in primary care, giving us immediate access to central nervous system and women’s health care products. The acquisition of Organon BioSciences also fills a gap in our late-stage pipeline by adding five compounds in Phase III development and a number of promising projects in Phase II development.”
The Kenilworth, New Jersey-based company expects to save $500 million annually after the first three years.
Akzo is the largest Dutch chemical maker. Its shares soared to the highest level in five years since the news of the takeover — €7.09, or 15% to €53.50 in trading.
Schering-Plough shares rose to $24.34 yesterday in German trading after closing at $23.85 in New York on Friday. Takeover talks began nearly two weeks ago.
Akzo’s chief executive Hans Wijersr, said last month he was seeking to buy companies and secure licensing deals on new compounds to boost the company’s pipeline of new drugs.
He said the company may end the year with about half its new products coming from outside sources.
Schering-Plough will fund the Organon purchase with cash, debt and equity.
The deal has fuelled speculation that Akzo Nobel would takeover ICI, maker of Dulux Paints.
Additional reporting by Bloomberg and PA.
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