Novartis Aventis talk about tie-up

Main Category: Public Health
Article Date: 26 Feb 2004 - 0:00 PDT

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Novartis, a swiss pharmaceutical company, and Aventis, a Franco-German pharmaceutical company have started having preliminary talks about a possible tie-up.

Aventis is being target by Sanofi-Synthelabo, a French pharmaceutical company. It is classed as a hostile takeover bid. This means that Aventis does not want to be taken over by Sanofi-Synthelabo. For Aventis, Novartis is seen as a white knight.

In business, a white knight is a company that enters into the bidding during a hostile takeover bid, the white knight is seen as more desirable for the company being taken over.

The Wall Street Journal Europe said that Novartis and Aventis are looking at defensive options open to Aventis.

The head of Aventis, Igor Landay, went to Kuwait two weeks ago. A company in Kuwait, Kuwait Petroleum, owns 13.5% of Aventis (its largest shareholders). He wanted to talk to Kuwait Petroleum executives and tell them that Sanofi-Synthelabo's bid for Aventis was inadequate.

Sanofi has offered 54.70 euros per Aventis share. This would make the total bid worth 45.6 billion euros ($57 billion).

There seems no end to mergers and acquisitions in the pharmaceutical industry, especially in Japan and Europe.