Merck KGaA drafts in FD to handle Schering bid

DARMSTADT: Merck KGaA has brought in Financial Dynamics’ German joint venture firm A&B FD as it makes an unusual hostile bid for contraceptive pill inventor Schering.

Merck, the German drug company behind colorectal cancer drug Erbitux, announced its €14.6bn (£10.1bn) bid for Schering on Monday, a day after Schering said Merck had made the €77-
a-share cash offer.

Brunswick is handling financial comms for Schering around the bid.
A merger of the German firms would create a company with a global lead in the market for birth control pills and a range of drugs to treat multiple sclerosis and cancer. The two German companies bear no relation to US groups Merck and Schering-Plough.

Although Merck's offer represented a 15.4 per cent premium on Schering's share price, Schering's board rejected it, claiming the bid undervalued the company.

Cost cutting has helped Schering to beat analyst expectations with a 21 per cent rise in operating profit to £638m in 2005.

Schering is thought to be holding out for a 35 per cent premium, which would value the company at €17.1bn.

Hostile bids of this nature are rare in Germany. But the fact that 70
per cent of Schering is owned by different market players has made it an attractive target.

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