Novartis to buy rest of Alcon
Swiss pharmaceutical group Novartis is to purchase 52% of eye care specialist Alcon from Nestle in the second stage of a US$38.5bn deal agreed in 2008.
Swiss pharmaceutical group Novartis is to purchase 52% of eye care specialist Alcon from Nestle in the second stage of a US$38.5bn deal agreed in 2008.
Novartis bought 25% of Alcon, also based in Switzerland, in April 2008 for US$10.4bn and is now exercising its option to buy another 52% for US$28.1bn.
The group is also proposing to buy out the remaining 23% held by Alcon minority shareholders with an issue of new Novartis shares worth US$11.2bn.
Novartis says Alcon will strengthen its healthcare portfolio and provide greater access to the fast-growing global eye care sector, which is driven by an aging population, innovation and emerging markets.
"This is the right time to simplify Alcon's ownership to eliminate uncertainties for employees and shareholders," said Daniel Vasella, chairman and ceo of Novartis. "It will also allow us to strengthen innovation power by combining r&d efforts and grow our global market presence thanks to our complementary product portfolios."
Alcon focuses on surgical, pharmaceuticals and consumer eye care products. It claims to be the global leader in cataract and vitreoretinal surgery, offering medical devices and ophthalmic surgery products, as well as market leader in artificial intraocular lens (IOLs) based on the AcrySof family, which exceeded US$1bn of sales in 2008. The company also has a portfolio of specialist medicines for various eye diseases, including glaucoma and conditions in the front of the eye such as infections and allergies.
Strong growth has come from new products and global expansion, particularly in Japan, where three new medicines have been launched since 2006.
In addition, Alcon provides contact lens care products, OTC (over-the-counter) dry eye drops and ocular vitamins.
Novartis makes contact lenses through its Ciba Vision division, a sector in which Alcon is not active, and a complementary ophthalmic pharmaceuticals portfolio. It also provides complementary medicines for a number of eye diseases not addressed by Alcon's portfolio and has an extensive r&d pipeline.
Together Alcon and Novartis will provide complementary eye care products that cover more than 70% of the global vision care sector.
The acquisition is subject to regulatory approvals and should be completed in the second half of 2010.
