McKesson Said to Offer Celesio Bid of 23.50 Euros a Share

McKesson Corp. offered to raise its bid for German drug distributor Celesio AG to win support from U.S. hedge fund Elliott Management Corp., according to two people with knowledge of the matter.

McKesson would be prepared to pay 23.50 euros a share, up from 23 euros previously, said the people, who asked not to be identified because the discussions are confidential. The San Francisco-based company’s 3.9 billion-euro ($5.3 billion) tender offer, announced Oct. 24, expires at midnight Frankfurt time tonight.

The bid is conditional on support from stockholders representing 75 percent of Stuttgart, Germany-based Celesio’s stock. Elliott, the fund run by Paul Singer, has said the original 23-euro-a-share deal undervalues Celesio and the firm won’t tender its shares. Elliott holds more than 25 percent of the voting rights in Celesio.

Spokesmen for Celesio and Elliott declined to comment. Reuters reported the higher offer earlier today.

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