* McKesson says fails to get 75 pct threshold
* McKesson left without partner in consolidating industry
* Celesio says to resume pre-offer strategy
* McKesson shares down 4.9 pct
FRANKFURT, Jan 13 U.S. drugs wholesaler group
McKesson said on Monday it had failed to win enough
support for a $8.4 billion offer to buy German distributor
Celesio, leaving it empty-handed in a sector where
cross-border consolidation is accelerating.
The suitor last week raised its offer for Celesio to 23.50
euros per share from 23 euros following pressure from activist
hedge fund investor Elliott, which had become Celesio's
second-largest shareholder behind Franz Haniel & Cie GmbH.
But McKesson said on Monday it had still failed to get
across the 75 percent threshold for acceptances which it had set
as a condition for going ahead with the higher offer.
"While we are disappointed that we were not successful in
completing our offers for Celesio, we have a track record of
great performance, a strong balance sheet and demonstrated
leadership and scale across our markets," McKesson's chairman
and chief executive, John Hammergren, said in a statement.
"We are well positioned and will continue to explore and
evaluate opportunities to further strengthen our businesses
through our disciplined approach to capital allocation."
McKesson shares were down 4.9 percent at $167 at 1900 GMT.
The setback leaves McKesson without a partner while
elsewhere in the industry, cross-border tie-ups are picking up
McKesson-Celesio would have eclipsed another transatlantic
tie-up in drugs trading, the purchase of a 45 percent stake in
European pharmacy chain Alliance Boots by U.S. peer Walgreen Co
Alliance and Walgreen have close to $110 billion in annual
revenue between them but are looking to bulk up further as they
build a stake in distributor AmerisourceBergen.
Pharmacy chain CVS Caremark and drugs distributor
Cardinal Health last month struck a 10-year agreement to
form the largest generic drug sourcing operation in the United
Some analysts think the McKesson should give it another try.
"With material accretion assumed in Street models coupled
with all of the work McKesson has committed to this deal, we
would have to think the company makes one more attempt for
Celesio," said Greg Bolan, an analyst at Sterne Agee.
Franz Haniel & Cie GmbH, which holds a 50.01 percent stake
in Celesio and had accepted the original offer, said it
regretted that the bid was not successful.
"We can now take our time at Haniel to calmly analyse the
situation and consider all options," Chief Executive Stephan
Gemkow said in a statement.
No one at Elliott was immediately available to comment.
Left on its own, Celesio said it would resume a strategy it
had drawn up before the takeover offer.
In response to a tough business environment, Celesio Chief
Executive Marion Helmes had been centralising procurement to cut
costs, as well as widening and standardising the offering of its
pharmacies across Europe under the Lloyds brand.
"Our strategy to widen our network of pharmacies and our
central procurement and to optimise the supply chain is
successful and will be pursued further as before," Helmes said
Celesio has been in a price war that has all but erased
profit from a crowded German drugs wholesale market. Healthcare
cuts across Europe, its main market, have added to woes.
But even before the bid Helmes had conceded that an alliance
or tie-up with a U.S. partner could help win steeper discounts,
mainly for the generic drugs it buys but also for
non-prescription medication and skincare products.