UPDATE 1-McKesson wins deal for 75 pct stake in Celesio

Thu Jan 23, 2014 5:37pm EST

* Company to offer 23.50 euro/shr for remaining shares

* McKesson say to enter into domination agreement with Celesio

* Elliott, Haniel offered to sell combined stake of 75 pct

FRANKFURT, Jan 23 (Reuters) - U.S. drugs distributor McKesson succeeded in its second attempt to win control of German peer Celesio in a deal with Celesio's two largest shareholders, German investment group Haniel and U.S. hedge fund Elliott.

McKesson, the largest U.S. drugs wholesale group, said late on Thursday that agreements with the two shareholders secured it ownership of about 75 percent of Celesio shares, including those from bonds that convert into shares, and that it would make a fresh offer for the remaining shares.

The offer of 23.50 euros per share, which values Celesio at about 6.2 billion euros ($8.5 billion) including debt, would not be subject to any completion conditions, it said.

The company did not say how much it offered to pay for the convertible bonds.

Family-owned conglomerate Franz Haniel & Cie, Celesio's majority shareholder, had been in talks on Thursday for a deal that could salvage its on-off takeover by McKesson, people familiar with the negotiations told Reuters earlier.

Haniel's previous attempt crumbled this month, when McKesson failed to reach the 75 percent shareholder acceptance it had set as a condition for a Celesio takeover, even after agreeing to Elliott's demands for a sweetened bid.

Elliott afterwards increased its stake in Celesio, giving it and Haniel enough shares between them broker a new deal with McKesson.

McKesson wanted to acquire Celesio to further its push to become a global leader in drugs distribution, boosting its bargaining power with big pharmaceutical companies such as Novartis and Teva.

Haniel, now in for 2 billion euros in proceeds, has been shedding assets to offset a massive 2012 write-down on its holding in German retailer Metro and reduce a debt burden that stood at 1.6 billion euros ($2.17 billion) at Sept. 30.

McKesson said it could now enter into a so-called domination and profit and loss transfer agreement with Celesio, which will allow it to take control over Celesio and gain access to its cash flows.

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