Stada Gains as Advent, Shanghai Pharma Said to Mull Rival Offer

  • Consortium said to mull offer of about 70 euros a share
  • New offer could upset $5.8 billion bid from Bain and Cinven

Buyout firm Advent International Corp. and Shanghai Pharmaceuticals Holding Co. are weighing an offer for Stada Arzneimittel AG, people familiar with the matter said, potentially restarting a bidding war for the German drug company.

Advent and Shanghai Pharmaceuticals are discussing a potential bid of about 70 euros a share, though no final decisions have been made and the companies may decide against making a bid, the people said, asking not to be identified because the discussions are private. The price would beat the offer Stada’s board had accepted from Bain Capital and Cinven. Shares of the German drugmaker climbed by the most in more than a month.

Representatives for Advent, Bain, Cinven, Shanghai Pharmaceuticals and Stada declined to comment.

Stada had agreed to sell itself to Bain and Cinven in April in a deal that valued the German generic drug business at 5.3 billion euros ($5.8 billion), including debt. The buyout firms said they’d pay 65.28 euros a share, plus a dividend of 72 cents, or about 49 percent above Stada’s share price in December when takeover talk first surfaced.

The shares climbed to their highest level on Tuesday since Stada’s listing in 1998, trading up 1.5 percent to 66.40 euros at 9:37 a.m. in Frankfurt. Stada has gained 35 percent this year, giving the Bad Vilbel, Germany-based company a market value of about 4.14 billion euros.

Bain and Cinven have already started the process of buying out investors in Stada. They have until June 8 to secure a commitment from holders of about 75 percent of the shares.

That deal had come after months of negotiations as cash-rich buyout firms competed for the asset. Advent had originally teamed up with Permira to make an offer. As part of the transaction, Bain and Cinven had agreed to honor Stada’s existing union contracts and refrain from business-related layoffs for four years, other than those already planned. The location of its headquarters and key business units will also remain unchanged, Stada said at the time.

— With assistance by Naomi Kresge, Simon Lee, Sarah Syed, Hui Li, and Ruth David

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