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MCK/Celesio Deal Failure Odds 50% as Elliott Plays ‘Chicken’:ISI 2014-01-06 14:04:11.192 GMT
By Cristin Flanagan Jan. 6 (Bloomberg) -- 50% chance McKesson’s purchase of Celesio may fall through as Elliott Management seeks higher bid for its stake in Celesio, writes ISI analyst Ross Muken. * NOTE: Dec. 23, Elliott ‘Irrevocably’ Rejects McKesson’s Offer for Celesio * Dec. 12, M&A SCENARIOS: McKesson May Raise Celesio Bid; Counter Unlikely * If tender offer for Celesio successful, Muken sees 1 of 2 scenarios MCK raising value of Celesio’s conv shrs, Elliott sells shrs at market to drop back below 25% threshold * MCK may rise to $165-$170 if tender successful, fall to ~$150 if fails * NOTE: Dec. 10, ISI said: probability of Celesio deal failure to ~25% after Elliott announcement vs 10% previously * CLS1 GY shrs extend losses to as much as 1.9%; falls as low as EUR22.55 vs MCK offer EUR23 * MCK 15 buys, 3 holds, 1 sell; avg PT $175 (in-line with ISI PT): Bloomberg data For Related News and Information: First Word scrolling panel: FIRST<GO> First Word newswire: NH BFW<GO>
--With assistance from Gaurav Panchal in London. Editor: Joanna Ossinger
To contact the reporter on this story: Cristin Flanagan in New York at +1-212-617-8919 or cflanagan1@bloomberg.net
To contact the editor responsible for this story: Joanna Ossinger at +1-212-617-7789 or jossinger@bloomberg.net