Offers for Merck KGaA’s generics unit are expected to be in by Monday, according to media reports and the German firm is feeling confident that the price will reach five billion euros.
The Financial Times cited an unnamed source as saying that Merck’s chief financial officer Michael Becker expects the sale of the generics operations to hit the five billion mark and potential buyers are to submit non-binding offers by Monday.
Speculation of a bidding war has pushed up Merck’s share price in the last couple of days and a whole host of suitors are thought to be preparing a bid. Among drugmakers, the USA’s Mylan Laboratories is the latest firm thought to be interested, joining the likes of Iceland’s Actavis and Indian firms Ranbaxy and Dr Reddy’s. Bids from Israel’s Teva or Novartis’ Sandoz generics arm cannot be ruled out.
However a number of private equity companies are also expected to make offers. Bain and Apax are rumoured to be keen on making a joint bid, while Kohlberg Kravis Roberts & Co and Warburg Pincus, are also thought to be interested. Another financial investor, The Carlyle Group, is also mulling a bid, according to media reports.
Merck is looking to close the sale of the unit, which had sales in 2006 of some 1.8 billion euros, by May or June and the funds will be used to finance its recent acquisition of Switzerland’s Serono.
