Wednesday, June 14, 2006

A three horse race for Pfizer OTC?

GlaxoSmithKline, Johnson & Johnson and Reckitt Benckiser have each offered US$14 billion (€11 billion) or more for Pfizer’s Consumer Healthcare business, according to various press reports.

The reports suggest Bayer, Colgate-Palmolive, Novartis, Procter & Gamble and Wyeth have all dropped out of the auction following the first round of bidding on 6 June.

However, the Financial Times noted there was “still a small chance that one of the groups excluded from the latest round, such as Colgate-Palmolive or Wyeth, could decide to re-enter the race with a higher offer that Pfizer could not ignore”.

The newspaper recently suggested GlaxoSmithKline was prepared to bid more than US$15 billion for Pfizer Consumer Healthcare, which owns the allergy medicine Benadryl, the oral-care line Listerine and the smoking-cessation aid Nicorette.

Pfizer’s vice-chairman David Shedlarz said earlier this year that the company expected to make a decision on the future of its Consumer Healthcare business in the third quarter of 2006.

A bid of US$14 billion for Pfizer Consumer Healthcare represents around 3.6 times the unit’s 2005 turnover of US$3.88 billion.

Reckitt Benckiser recently paid 3.7 times turnover for Boots Healthcare International.

Source: OTC Bulletin

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