Companies
Alliance Boots accepts higher offer from deputy chairman and KKR
The board of Alliance Boots is
recommending that shareholders accept a bid for the healthcare retailer from
private equity giant
Kohlberg Kravis Roberts (KKR), and its deputy executive chairman, Stefano Pessina,
who retains a 15% shareholding in the company.
KKR and Pessina have been granted a limited time to carry out due
diligence at the company. Pessina had been the executive deputy chairman of
Alliance UniChem, and previously its chief executive, prior to its merger with
Boots last year.
The private equity offer is set at £10.40 a share and was an increase from an
earlier £10 a share bid that was rejected by the Alliance Boots board. The board said
then that it did not believe the offer reflected the
fundamental value of the company or the attractive prospects, opportunities and
synergies available to Alliance Boots following the completion of
its merger.
Damian Reece, commenting in the
Daily Telegraph (13 March) after the first offer, suggested that while the board was right to
reject the £10 a share offer, if more was offered this should secure talks
between the two sides. He said that Pessina had become frustrated with the
public markets and did not want to have to defer to a non-executive chairman.
However, Jeremy Warner in The Independent
(13 March) said there was deep anger in the City that Pessina had collaborated
with the private equity bidders less than a year after the merger because it
suggested that he believed he would find the value in the company he believes
investors have failed to recognise.
Links
Alliance Boots
Kohlberg Kravis Roberts
Daily Telegraph
The Independent
Financial Times
April, 2007 |
