German drugs and chemicals group Bayer has prevailed in its takeover bid for Schering. Rival Merck has agreed to sell the more than twenty one per cent of Schering’s shares it holds to Bayer for around 3.7 billion euros. The move ends uncertainty over Bayer’s proposed acquisition and provides a windfall for both Schering and Merck shareholders.
Bayer’s original offer was for 86 euros a share; it will now pay 89 euros for each to Merck. Other sellers, who had already tendered their stock, will get the same price.
Merck said it will make a one-off gain of 400 euros from the share sale. The deal was reached after the three German companies held joint talks. Merck had originally tried to takeover Schering, but Bayer came in with a higher bid. Instead of backing off Merck continued to buy shares threatening to block Bayer.
It was an unusually aggressive move as in Germany deal-making tends to be consensual. Despite the bad feeling generated, Bayer said it and Merck would look at possible opportunities for commercial cooperation.