(Repeats story published late on Monday)
By Sudip Kar-Gupta and Jana Mlcochova
PARIS/PRAGUE, Sept 22 (Reuters) - Czech generic drugmaker
Zentiva <> accepted a new takeover offer from France's
Sanofi-Aventis <SASY.PA> on Monday at a price that will likely
tempt shareholders, analysts said.
Sanofi said on Monday it had raised its offer to 1,150 Czech
crowns per share, a premium of around 6 percent to Zentiva's
closing share price of 1,085 crowns on Friday.
The new offer values Zentiva at around 1.8 billion euros
($2.6 billion).
The acquisition takes Sanofi deeper into the field of
generic or unpatented medicines -- an area previously shunned by
large pharmaceutical companies but which is now receiving
increased attention as a way to tap booming emerging markets.
Zentiva rejected an earlier 1,050 crown per share bid by
Sanofi, saying it failed to reflect the company's future growth
potential.
"We believe that the improved offer represents attractive
value for Zentiva's shareholders, particularly in light of the
current market turbulence," Zentiva's chief executive Jiri
Michal said in a statement.
Michal also said he would tender his 3.4 percent stake in
the group, along with other company managers holding 2.3
percent. As part of the deal, Michal will stay on as Zentiva's
CEO.
Zentiva had been at the centre of competing takeover bids
since May, when the drugmaker's second-largest shareholder,
Czech financial group PPF, said it would bid 950 crowns per
share.
The move prompted Sanofi, the largest shareholder with a
24.9 percent stake, to launch its own 1,050 crown a share bid in
July.
Zentiva said the latest bid represents a 25.5 percent
premium over its closing price of 916.6 crowns on April 30, the
last trading day before PPF announced its bid intention.
The bid is conditional on gaining more than 50 percent of
Zentiva, along with competition clearance.
Sanofi, whose top selling drugs include blood thinner Plavix
and anti-thrombotic Lovenox, has already won approval in Russia
and Ukraine, and is awaiting clearance from the European Union
and Turkey.
CHANCES OF SUCCESS
Dealers say the improved bid could lure many of Zentiva's
investors including PPF which, together with Italy's Generali
<GASI.MI>, holds 19.2 percent, and Czech investment group J&T,
which controls 7.6 percent in Zentiva through its subsidiary
Frevent Holding.
"The chances that Sanofi succeeds with its bid are
definitely higher than they were before," a Prague-based fund
manager said, adding that the premium to the old offer was
attractive enough.
"The price is pretty interesting. I cannot exclude that
Sanofi will succeed," said Milan Vanicek, an analyst at Atlatnik
FT. He said PPF could sell its stake as part of the offer, which
appears a good deal in view of the price it paid for the Zentiva
shares.
PPF entered Zentiva in 2005 as a portfolio investment at
prices around 1,025 crowns per share. It has since raised its
stake and changed its approach after the stock plunged from an
all-time high of 1,571 crowns last year, following
worse-than-expected results.
PPF said in a statement that it did not want to comment on
the bid until it is approved by Czech regulators and reviewed by
its board of directors.
J&T's spokesman said: "We will analyse the offer and we will
see."
Zentiva, which produces generic copies of branded drugs,
operates in central and eastern Europe, with the Czech Republic,
Romania and Turkey among its largest markets.
Zentiva closed 6.2 percent higher at 1,152 crowns on Monday.
Its shares have added 18.3 percent from the beginning of the
year, outperforming Prague's main PX index, which dropped 27.8
percent. The company trades at 21.8 times this year's forecast
earnings, versus a European sector average of 22.9, according to
Reuters data.
Sanofi trades at just 9 times this year's forecast earnings.
At 1530 GMT, its shares closed almost 4 percent down, falling to
45.66 euros. Sanofi shares have fallen around 27.5 percent since
the start of the year.
(Additional reporting by Jason Hovet in Prague and Ben
Hirschler in London; editing by Andy Bruce and Simon Jessop)
