Shionogi & Co, Ltd and US-based Sciele Pharma, Inc have entered into a definitive agreement under which, Shionogi will make a cash tender offer for Sciele shares and subsequently acquire Sciele by executing a cash merger.
Under the terms of the agreement and pursuant to a tender offer, Shionogi intends to acquire through a wholly-owned US subsidiary all of the outstanding shares of Sciele's common stock at a price of $31 per share, for a total purchase price of approximately $1.1 billion. Upon completion of the acquisition, Sciele will become an indirect wholly-owned subsidiary of Shionogi and will continue operations in Atlanta, GA as a standalone business unit. The Board of Directors of Shionogi and Sciele have each approved this transaction. This acquisition is subject to clearance under the Hart-Scott-Rodino Antitrust Improvement Act and other customary conditions. This transaction will not result in any reduction of Sciele employees.
Sciele is a pharmaceutical company specializing in sales, marketing, and research & development of branded prescription products focused on cardiovascular disease and diabetes, women's health and paediatrics. Sciele has achieved steady sales expansion based on placing the needs of patients first, improving health and quality of life of patients, and implementing its business platform - an entrepreneurial spirit, innovation, speed of execution, simplicity, and teamwork - and shares the business principles and vision held by Shionogi management.
Patrick Fourteau, chief executive officer and one of the Directors of Sciele, said, "Sciele will be a stronger company as part of Shionogi, which is one of the leading pharmaceutical companies in Japan due to its extensive product pipeline. Shionogi will rely on Sciele to continue to operate on the business platform that has made our company successful, a platform focused on: an entrepreneurial spirit, innovation, speed of execution, simplicity, and teamwork. The Sciele management team will remain in place and we look forward to contributing to the continued growth and profitability of Shionogi in the United States."
Shionogi believes that the Sciele acquisition is an important investment that will not only allow Shionogi to strengthen its sales infrastructure in the United States, but will also allow Shionogi to further establish its presence and fully realize the value of its proprietary pipeline, thereby allowing it to achieve long-term growth.
Through the Sciele acquisition, along with its existing operations under Shionogi USA, Shionogi will increase its efforts to strengthen its pipeline of drug candidates and to accelerate overseas development in the future in order to achieve full benefit from this acquisition. Shionogi plans to consolidate Sciele's earnings for the three months ending December 2008 from the second half of fiscal year ending March 2009, and EPS is expected to become accretive from fiscal year ending March 2010. Also, details concerning creation of goodwill and in-process R&D expense (a one-time write-off in fiscal year ending March 2009) will be announced when finalized.