European pharmaceutical producer Stada (ETR: SAZ) agreed to sell itself to Bain Capital and Cinven for €66 per share in April, representing a deal value of €4.1 billion after months of negotiations. That deal is now in serious doubt, however.
As of late Thursday, the PE firms had received backing from less than 50% of the pharmaceutical company’s shareholders, way off the 67.5% needed under the deal terms. The uncertainty carried through the weekend, as reports have indicated it could be until Tuesday before the final tendered shares are delivered.
Bain and Cinven extended the period for the offer to be accepted and lowered the threshold of 75% after missing that mark at the beginning of the month. German takeover law prohibits amendments to the offer at this stage and the buyout firms will only be able to table a new offer with Stada’s approval in a year’s time.
Overall PE deals in Europe's pharmaceutical sector have been mixed over the last couple of years. Deal count has been declining, from 49 in 2015 to just 13 so far this year, per the PitchBook Platform. This is on par with the prevailing trend of lower deal count throughout most of the PE industry.
A successful bid by Bain and Cinven would add to that. A failed bid, on the other hand, may well result on in another—likely to be lower—offer from an opportunistic acquirer.