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Bidvest lifts stake in Adcock

Johannesburg - The Bidvest Group has increased its stake in drugmaker Adcock Ingram [JSE:AIP] to 9% and will close its offer for the drugmaker soon, said chief executive Brian Joffe.

Bidvest will close its offer for a stake in drugmaker Adcock Ingram early next month, in what may be an attempt to speed up a takeover battle that has been waylaid by delays.

Bidvest, a conglomerate that spans shipping to auto sales, is attempting to thwart a takeover of Adcock by Chilean firm CFR Pharmaceuticals.

The Johannesburg-based company has lifted its holding in Adcock to 9%, Joffe told Reuters, although he declined to say whether he was trying to put pressure on CFR.

Strategic

"We have a strategy which we want to implement and I really don't want to be able to tell you what it is in advance," he said.

Bidvest said in December it had around 7% of Adcock.

Santiago-based CFR has bid R12.8bn in cash and shares for Adcock, an offer shareholders were initially due to vote on last month. The vote has been twice delayed and is now expected in mid-February.

"Adcock has been subjected to a protracted period of continuous delays throughout which time the attention of the Adcock board and management has been diverted from optimising the operational performance," Bidvest said in a statement.

"This has been exacerbated by the protracted process relating to the offer by CFR Pharmaceuticals."

Approval

CFR needs approval from investors with 75% of Adcock.

The rare Chile-South Africa tie-up is almost certain to fail because South Africa's state pension fund, which owns over 22% of the drugmaker, is also opposed to CFR.

The state-owned Public Investment Corporation (PIC) has said it doesn't want shares in CFR and wants to benefit directly from a turnaround at Adcock.

The PIC is also the top shareholder in Bidvest, leading to some speculation Joffe is working with the fund to thwart CFR, something he has denied.

CFR wants to add fast-growing Africa to its businesses in Latin America and Asia.

Bidvest's Joffe, who has a long track record of turning around underperforming companies, sees in Adcock an opportunity to roll out the drugmaker's products in sub-Saharan Africa, where Bidvest has little presence.

Bidvest said its cash offer of R70 a share for 34.5% of Adcock will close at 15:00GMT on February 4.

CFR is offering R74.50 worth of cash and shares, based on a value of R2.334 per new CFR share.


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