Pronova BioPharma Sandefjord factory. (Photo: Pronova BioPharma)
Chemical company to buy Norwegian omega-3 manufacturer
Thursday, November 22, 2012, 01:40 (GMT + 9)
Leading Frankfurt, Germany-based international chemical company BASF said that it plans to acquire Norway-based omega-3 fatty acids manufacturer Pronova BioPharma ASA. The parties reached an agreement for a recommended voluntary public takeover offer to Pronova’s shareholders and a payment of NOK 12.50 (EUR 1.70) in cash for each Pronova share.
BASF has also received irrevocable pre-acceptance commitments for roughly 60 per cent of Pronova’s share capital, including the 50.0 per cent stake held by majority shareholders Herkules Private Equity Fund, an approximately 9.1 per cent stake indirectly owned by investment firms Kistefos AS and Kistefos Investment AS and 0.3 per cent held by members of the Board of Directors and Pronova management.
The offer corresponds to a premium of 24 per cent above the volume-weighted average share price for the company’s shares in the six months prior to the announcement of the public takeover offer. The enterprise value stands at NOK 4.8 billion (EUR 664 million), including debt.
“The intended acquisition will significantly strengthen our position in the fast-growing and highly profitable market for omega-3 fatty acids,” said Michael Heinz, Member of the Board of Executive Directors of BASF SE and responsible for the Performance Products segment. “We want to combine the global market reach and experience of BASF with the know-how of Pronova in omega-3 fatty acids.”
Shares in Pronova, which manufactures the omega-3 heart medication Lovaza to GlaxoSmithKline, surged to NOK 12.7 (EUR 1.73) this week, above BASF's offer of NOK 12.5 (EUR 1.70), due to investors' hopes that BASF would place a higher bid, Reuters reports.
"The premium is a bit low but all in all, we are satisfied. This is still the best solution for shareholders," Herkules Managing Partner Gert Munthe said.
"The process was initiated by Pronova. It is not likely there would be a higher bid. We have been in dialogue with other players and this is the best we could come up with," he added.
Via this acquisition, BASF will automatically gain a leading position in the global market for this product.
The offer will be executed by BASF’s wholly-owned Norwegian subsidiary BASF AS and will be subject to certain conditions, including inter alia that shareholders shall in the aggregate have accepted the offer for a certain amount of shares representing more than 90 per cent of the total share capital of Pronova, and the same number of votes which can be used in Pronova’s general meeting.
BASF’s offer will also be subject to approval by merger control authorities.
The complete details of the offer, including all terms and conditions, will be described in a document complying with the requirements of the Norwegian Securities Trading Act, which will be sent to Pronova’s shareholders around 5 December 2012. BASF anticipates to complete the transaction in Q1 2013.
By Natalia Real