FRANKFURT (Reuters) - German pharma group Merck KGaA launched a hostile $5.9 billion all-cash takeover offer for Versum Materials on Tuesday to boost its presence in the semiconductor materials market and sideline a rival bidder.
Versum, the former specialty chemicals division of industrial gases group Air Products, has been opposed to Merck’s unsolicited cash offer since it was first proposed last month, saying it was committed to an all-share merger with U.S. rival Entegris agreed in January.
Merck kept its offer price unchanged at $48 per share on Tuesday. That compares with an offer of $39.20 worth of Entegris stock for each Versum share under their deal. Entegris was trading at $35 on Tuesday.
“The Versum board’s hasty rejection of our proposal and unwillingness to engage in discussions with us has forced us to take this proposal directly to shareholders,” family-controlled Merck said in a letter to Versum shareholders.
For diversified Merck, controlled by descendants of the group’s 17th century founder, this marks the first hostile takeover attempt since its 2006 swoop on domestic drugs rival Schering, which Bayer eventually acquired for 17 billion euros.
The move is also the first major hostile takeover bid by a German company for a U.S. target since BASF’s 2006 approach for catalytic converter maker Engelhard, which ended up becoming an agreed deal.
Merck’s offer will run until June 7, the letter said. A Merck spokesman said the offer would be conditional on Merck winning over investors with combined holdings of more than 50 percent of Versum shares.
Merck said that Bank of America Merrill Lynch, BNP Paribas Fortis and Deutsche Bank had committed financing
