Faced with some stiff opposition from investors arrayed against a proposed $1.6 billion merger of Charles River Laboratories and China's WuXi PharmaTech, the Massachusetts-based CRO is baiting its hooks for shareholders with the promise of up to $100 million in annual "synergies" if the deal goes through.
"We are confident that our proposed combination with WuXi will create not only the world's premier early-stage contract research organization, but also significant additional shareholder value," said Charles River Chief Executive Officer James C. Foster. "Among the many metrics that support this view are the estimated revenue synergies we expect to generate from the combination."
Foster will bring that argument, and the prospect of $75 million to $100 million in potential operational savings, to the shareholders' meeting scheduled for August 5. The company already faces opposition from big investors like Jana Partners and Neuberger Berman, which see the deal as risky and sub-optimal. Charles River, meanwhile, says it also had a second request for information from the Federal Trade Commission.
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- here's the report from Reuters