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Johannesburg - Pharmaceutical group Cipla Medpro South Africa (CMSA) says its lack of support for a takeover bid by Adcock Ingram was not due to the alleged Cipla India termination clause.
"Cipla India refuses to do business with Adcock irrespective of any contractual niceties," said CMSA in a Stock Exchange News Service (Sens) statement on Friday.
This week, Adcock CEO Jonathan Louw expressed his displeasure at the way Cipla dealt with the offer. The company said it was unaware of the possible existence of a termination clause.
But according to CMSA, Adcock approached it in April with an offer of R4.75 per share, despite having been informed in December 2008 that Cipla India would oppose a takeover.
"Adcock's attempt to place the blame for the failure of the offer based on Cipla India's lack of support is disingenuous and misleading," said CMSA.
CMSA said Adcock was aware that CMSA's relationship with its supplier was fundamental to any acquisition considerations.
According to some reports, a letter from Cipla India in response to the offer alluded to the fact that its supplier's agreement with CMSA could be terminated in the event of any "changes in management".
Adcock Ingram withdrew its R2.1bn offer on Tuesday, citing the possibility of a termination clause between CMSA and Cipla India.
CMSA says the offer was rejected as Adcock was associated with companies in competition with Cipla India, and that there was no compelling case to merge the companies.CMSA has a long-standing agreement with Cipla India to distribute its products, including generic drugs, in South Africa.
Louw said in an interview with Fin24.com earlier this week that it was in Adcock shareholders' interest to withdraw from the deal.
- Fin24.com
