Elliott Moves To Block Pharma Merger

Dec 10 2013 | 1:24pm ET

Elliott Management today made good on its threat to try to sink the merger of two pharmaceutical distributors.

The activist hedge fund warned that it would not tender its shares in Celesio unless its would-be buyer, McKesson, "offers fair compensation to all Celesio shareholders and bondholders." McKesson's US$8.3 billion deal requires the tendering of 75% of Celesio shares; Elliott currently owns 25.16%.

Even after that stake is diluted by bond conversions, Elliott will still hold a 22.7% voting stake, which should be enough to block the deal.

McKesson can back out of a deal to buy a majority stake in Celesio from Franz Haniel & Cie if 75% of shares are not tendered. But Elliott does not seem concerned that the deal will die.

"We believe Celesio has other paths to maximize shareholder and bondholder value," Elliott said, suggesting that the company could be split: "Sell the wholesale business to a strategic bidder and the pharmacy business to a separate buyer."


In Depth

Q&A: Open Season For Closed-End Funds

Aug 29 2014 | 10:00am ET

When Maury Fertig and Bob Huffman, former Salomon Brothers coworkers, launched...

Lifestyle

Och Funds Women In Finance Initiative At U-M

Aug 28 2014 | 3:01pm ET

Och-Ziff Capital founder Daniel Och and his wife have made a "generous donation"...

Guest Contributor

Looking Ahead: What’s In Store For Managed Futures?

Aug 22 2014 | 12:52pm ET

The last five years were phenomenal for investors in equity indices. Will the next...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

July/August 2014 Cover

New customer protection rules have landed: Are you ready?

The twin debacles of MF Global and PFG have damaged the reputation of the futures industry demanding an examination of customer protection rules. New rules are being implemented, which will add cost a...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.