King nabs Alpharma for $1.6B

King Pharmaceuticals, which has been courting Alpharma for months now, has finally gotten its wish. Alpharma rejected King's first offer [1] of $1.4 billion back in September--although it was a 49 percent premium over Alpharma's share price on August 4. And again slammed King's tender offer [2] of $37 a share last month, calling the offer "financially inadequate." Although Alpharma claimed it had other companies interested in a buyout, King pushed foward with the hostile bid [3]. But today the companies announced a $1.6 billion merger agreement under which Alpharma shareholders will sell to King for it's latest offer of $37 a share. The tender offer that was to expire on Friday has now been extended until December 19. The sell is expected to be completed by the end of the year.

So why the change of heart? Well, King had threatened a proxy battle if Alpharma continued to reject its offers. But here's how Alpharma puts it: "The transformation of Alpharma over the past two years has created tremendous shareholder value, and we have consistently said that we will act in the best interest of shareholders," commented Dean Mitchell, Alpharma's President and CEO. "Therefore, after careful evaluation, our Board determined that a combination with King is in the best interest of our shareholders and provides them immediate access to this value. We believe the combined company has a compelling strategic logic and will create a strong company for both shareholders and employees. We look forward to working with King's team to integrate our companies."

- check out the joint release [4]

Related Articles:
King responds to Alpharma's rejection [5]
Alpharma rejects King's bid--again [2]
King bumps Alpharma bid, threatens proxy fight [6]
Alpharma shares skyrocket on King's buyout offer [1]