Reckitt Benckiser Plc Trumps Bayer AG With $1.4 Billion Bid for Schiff

Published: Nov 16, 2012

Reckitt Benckiser Group Plc (RB.L) has trumped Bayer AG's (BAYGn.DE) agreed deal to buy Schiff Nutrition International Inc (SHF.N) with a higher offer of $1.4 billion for the U.S. vitamin maker. The bid, which tops Bayer's $1.2 billion price, opens up a potential bidding war for Schiff, whose portfolio of vitamins and nutritional supplements, such as MegaRed for heart care and Move Free for joints, is attractive to companies seeking stable sources of growth. Reckitt, the British consumer products group behind Cillit Bang cleaner and Durex condoms, said late on Thursday it would offer $42 in cash for each Schiff share, a 23.5 percent premium over the $34 per share that Bayer, Germany's biggest drugmaker, agreed to pay on October 30. Shares of Schiff Nutrition surged nearly 30 percent to $44 in after-hours trading on the New York Stock Exchange, above Reckitt's offer and indicating some investors expect the bidding to go higher still. Reckitt commenced a tender offer on Friday and said it would expire at 9:00 a.m. New York time on December 14, unless extended. The new offer values Schiff at about 3.6 times its forecast 2013 annual sales, which is around the top end of deal multiples in the non-prescription drugs industry.

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