Bidvest aims to acquire 34.5% stake in South Africa’s Adcock Ingram, to thwart CFR bid

South African conglomerate Bidvest, acting on behalf f a consortium including CIH, says it has offered to buy a stock of 34.5% in local drug major Adcock Ingram (AIP: SP), in a move that could scupper a previously-announced and agreed 12.6 billion-rand ($1.24 billion) takeover offer for the company from Chiles CFR Pharmaceuticals (The Pharma Letter September 12).

Bidvest, which already owns about 4% of Adcock, is offering an upfront cash consideration 70.00 rand per Adcock ordinary share, which it says is a significant direct investment by the consortium of around 4 billion rand (around $393.5 million) and will be funded by way of the consortium’s own available cash resources. The 70 rand price is no premium to Adcock Ingram’s share level last week. Bidvest had previously made a $675 million offer for majority (60%) control of Adcock, which was rejected.

In a statement, Adcock said its board believed the CFR offer was still "the most attractive opportunity for Adcock Ingram shareholders to maximise value,  and noted that Bidvest had not clearly articulated the benefits of its offer to shareholders, or how it would manage "potential conflicts of interest."