JSE-listed diversified industrials firm, Bidvest and South Africa’s government employee pension fund manager, Public Investment Corporation (PIC), have started talks to enter into what is called “pool agreement” for joint control of Adcock Ingram’s 82 million ordinary shares, it emerged on Wednesday.
These shares represent about 47.82 percent of Adcock’s issued ordinary share capital excluding treasury shares, the two companies said on Wednesday. Adcock is South Africa’s second biggest drug maker.
If these talks lead to the signing of the “pool agreement” it will be conditional upon receiving the required regulatory permits from competition authorities in South Africa.
At the heart of the “pool agreement” is the parties’ undertaking that Bidvest will be in charge of managing Adcock, subject to satisfactory performance, of course.
Bidvest’s firm goal of making an offer will be conveyed to Adcock within the next few days, the companies said.
Last month, Bidvest made an offer to acquire shares it doesn’t already own in drug-maker Adcock in a deal valued at about R6bn ($486.9 million).
Bidvest already owns 34.5 percent of South Africa’s second-biggest drug maker and has offered R52 ($4.2) per share in cash for the remainder of the stake in Adcock.
Adcock has the biggest market share in South Africa’s over-the-counter (OTC) medicines. However, it has been under-performing compared to its peers as it battled to increase its sales.