UPDATE 2-Nycomed makes 4-4.5 bln euro Solvay bid -sources

Fri Sep 18, 2009 7:22am EDT

* U.S. bank loans may help finance bid - sources

* Deal would draw heavily on U.S., European "junk" bonds

(Adds background on drugs and Nycomed owners, Solvay shares)

By Quentin Webb

LONDON, Sept 18 (Reuters) - Nycomed, the private equity-owned Swiss drugmaker, recently made a fully financed 4 to 4.5 billion-euro ($5.88 to $6.62 billion) offer to buy Solvay SA's (SOLB.BR) drug unit, people familiar with the matter said.

If successful a tie-up would create a group with about 6 billion euros in annual sales and would be the first takeover to be funded significantly by European "junk" bonds since the financial crisis began.

As reported by Reuters in August, Nycomed would fund any buyout of the Belgian pharmaceutical business by high-yield bonds in dollars and euros, 1 billion euros or more of fresh equity from Nycomed's owners, and existing cash. [ID:nL7219581]

Nycomed [NYCMD.UL], which has lined up bridge loans ahead of a bond issue, may also arrange longer-term bank finance via its U.S. subsidiary, two of the people said.

A Nycomed spokeswoman declined to comment.

A Solvay spokesman referred to comments made by Chief Executive Christian Jourquin, who said on July 30 that Solvay should have more clarity on the future of the unit in the fourth quarter and it would not be rushed with its strategic review. [ID:nLU559589]

HEARTBURN

It is not clear whether Nycomed faces any significant competition. Two of the people familiar with the matter said Solvay had received a number of proposals -- but some of its most likely suitors have publicly denied interest.

Abbott Laboratories (ABT.N), Solvay's partner for the blockbuster TriCor, said in July it had no interest in expanding in fenofibrates, the class of drugs including TriCor.

Japan's Takeda Pharmaceutical Co Ltd (4502.T) said in May it would not make a bid.

For Nycomed, whose biggest drug is heartburn treatment Pantoprazole, Solvay offers a complementary portfolio of drugs with similar-sized markets, a greater foothold in emerging markets, and the chance to reap big cost savings.

But Nycomed has had to weigh the patent threats to Solvay's two lead products, the cholesterol-lowering TriCor and testosterone-replacement drug Androgel.

Nycomed is owned by Nordic Capital, Credit Suisse's (CSGN.VX) DLJ Merchant Banking, Coller International Partners and Avista.

Shares in Solvay were 0.14 percent lower at 77.68 euros a share at 1120 GMT. ($1=.6802 euros) (WIth additional reporting by Philip Blenkinsop in Brussels; Editing by Greg Mahlich)

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