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CFR to Decide on Binding Adcock Offer in Weeks, CEO Says

CFR Pharmaceuticals SA (CFR), Chile’s largest drugmaker, will decide within weeks whether to make a binding offer for South Africa’s Adcock Ingram Holdings Ltd. (AIP), CFR’s Chief Executive Officer Alejandro Weinstein said.

CFR completed due diligence of the Johannesburg-based maker of hospital products and medicines in mid-August, and is now “doing a thorough review of all data to see if we move to the next binding step,” Weinstein said in an interview at CFR’s headquarters in Santiago on Aug. 30. “At this stage, we have to be very rational. No decisions can be done only by gut feeling.”

CFR said in July that it signed a non-binding agreement to buy Adcock in a cash-and-shares deal that values the South African company at a potential $1.3 billion, or 73.51 rand per share. The offer has prompted a rival bid from Actis LLP, a London-based private-equity firm, two people familiar with the matter said on Aug. 13. Johannesburg-based food and car sales company Bidvest Group Ltd. (BVT) had a bid for 60 percent of Adcock rejected in March and its pursuit remains a “work in progress,” Financial Director David Cleasby said on Aug. 26.

“If there are other bidders it’s a good sign,” Weinstein said, adding that his company has exclusive negotiating rights. “It means that we are aiming for something good. I would be more concerned if there weren’t other interested parties.”

Shareholder Opposition

CFR said in the July statement that it planned to finance the Adcock deal with a $750 million share sale, $500 million of debt and $50 million of cash. Any unsubscribed shares would be listed in Johannesburg and given to Adcock investors, a clause that has been opposed by some shareholders who said such an arrangement may overvalue CFR.

Adcock shares traded at 66.10 rand at the close in Johannesburg on Aug. 30, 10 percent below the potential value of the CFR proposal.

“If and when we move to the binding offer, we’ll disclose the final details of how much we plan to pay in cash and how much in shares,” Weinstein said.

To contact the reporters on this story: Eduardo Thomson in Santiago at; Javiera Quiroga in Santiago at

To contact the editor responsible for this story: David Papadopoulos at

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