Elliott Set To Seek Higher Price For German Drug Distributor

Nov 27 2013 | 9:33am ET

Elliott Management has put itself in position to demand a higher price for German pharmaceutical distributor Celesio from rival McKesson.

The hedge fund has bought up 25.16% of Celesio's voting shares. Even when those shares are diluted by convertible bonds, Elliott's stake will be 21.05%, which should be enough to ensure that McKesson is unable to meet the 75% approval hurdle it needs for its US$8.3 billion takeover.

McKesson is offering €23 per share for the 49.99% of Celesio not owned by Franz Haniel & Cie; the stock closed at €23.47 yesterday. Elliott has until Thursday to disclose its intentions to Celesio, which then has until Tuesday to publish the hedge fund's statement. Elliott is expected to push McKesson to at least €2 or €3 more per share than its current offer.

Should McKesson refuse, it could let its offer lapse and simply buy Haniel's majority stake, which would trigger a mandatory offer at the stock's average price over the past three months, which would be below €23.

In Depth

Related-Company Fees: Normal Industry Practice or Conflicted Compensation?

Nov 11 2015 | 4:23pm ET

Regulatory agencies as well as investors are increasingly exploring whether certain...


Ferrari Roars in Wall Street Debut

Oct 21 2015 | 4:28pm ET

Shares of supercar maker Ferrari jumped as much as 15 percent to a high of nearly...

Guest Contributor

Private Debt - What is the Opportunity?

Nov 11 2015 | 3:28pm ET

In this contributed article, Rob Allard, founding partner of Firebreak Capital...


Editor's Note

    Oct 21 2015 | 10:41am ET

    One of the most unique charity benefits in the hedge fund industry, A Leg To Stand On's (ALTSO's) Hedge Fund Rocktoberfest - NYC, raised nearly $500,000 last Thursday thanks to the generous support of major sponsors and nearly 1,400 attendees from the Tri-State finance, business and hedge fund communities. Read more…