AGL bats away Brookfield bid

BY Richard Summerfield

AGL Energy has rejected an unsolicited, sweetened $4bn takeover offer from tech billionaire Mike Cannon-Brookes of Grok Ventures and Canadian investment management firm Brookfield Asset Management. The offer, according to AGL, undervalued the company.

“The AGL Energy Board considers that the Revised Unsolicited Proposal is still well below both the fair value of the company on a change of control basis and relative to the expected value of the proposed demerger, and therefore is not in the best interests of AGL Energy shareholders,” noted AGL in a statement.

The revised proposal was for A$8.25 a share, a 15 percent premium to AGL’s share price on 18 February. The first proposal from the Brookfield-led consortium would have seen AGL shareholders receive A$7.50 per share.

“The revised unsolicited proposal continues to ignore the opportunity that AGL Energy shareholders have through our proposed demerger to realise potential future value,” said Peter Botten, chairman of AGL Energy. “It also ignores the momentum we have recently seen in the business through our solid half-year result, strong progress on the demerger, strong interest in our Energy Transition Investment Partnership and the improvements we are seeing in forward wholesale prices.”

The consortium’s proposal to spend between A$10bn and A$20bn in large-scale renewable energy and batteries to enable the early closures of AGL’s power stations that account for 8 percent of Australia’s overall greenhouse gas emissions “would have been the world’s biggest decarbonisation project”, according to Mr Cannon-Brookes. In response to AGL’s rejection of the offer, Mr Cannon-Brookes tweeted that the “Brookfield-Grok consortium looking to take private & transform AGL is putting our pens down, with great sadness”.

AGL owns three large coal plants, some gas and renewable assets, and one of Australia’s biggest energy retail business, with more than 4 million customers, according to its 2021 annual report.

Last year, AGL proposed splitting the company into separate publicly traded companies — AGL Australia and Accel Energy — aiming to cut greenhouse gas emissions by as much as 60 percent by 2034. The move would split the company’s retail and coal generation businesses to operate them as two separate divisions. The demerger is progressing well and on track for completion by June this year, the company said last month.

News: Australia's AGL Energy rebuffs sweetened $4 bln bid from Brookfield-led team

Biocon’s biosimilar boost

BY Richard Summerfield

A unit of Indian drug manufacturer Biocon Ltd has agreed to acquire Viatris Inc’s biosimilars business in a deal worth $3.34bn.

Under the terms of the deal, Viatris will receive up to $2.34bn in cash, and convertible shares in the unit Biocon Biologics worth $1bn.

The deal, which is expected to close in the second half of 2022, will see the cash portion of the transaction funded through an $800m equity commitment in Biocon Biologics, with the remainder being funded through debt.

Kiran Mazumdar-Shaw will continue as the executive chairperson of Biocon Biologics. Viatris will nominate Rajiv Malik, president of Viatris, to serve on the Biocon Biologics board.

The two companies had built collaborations on multiple biosimilar products before Viatris formed from Mylan’s acquisition of Pfizer’s Upjohn established medicines business. Biocon has been responsible for research and development (R&D) and manufacturing under the terms of their old partnership, however the company is now buying Viatris’ commercial capabilities.

“By combining the biosimilars business of Viatris to create a global, vertically integrated business in BBL, we are confident of unlocking significant value for our stakeholders,” said Dr Arun Chandavarkar, managing director of Biocon Biologics. “This deal gives BBL full ownership of Viatris’ rights in biosimilars assets, enabling us to recognize combined revenues and profits. To ensure a seamless transition and continued service to patients and customers, Viatris will provide commercial and other transition services to BBL for an expected period of two years.

“This deal provides several advantages, including strategic agility and operational efficiencies, which will help us mitigate pricing pressures in a competitive global biosimilars landscape,” he continued. “We remain committed to sustainable growth with a strong financial profile, expanded geographical reach and continued investments in R&D to build a world-leading biosimilars franchise. We believe that as a fully integrated global company, we will be able to enhance patient access and reduce healthcare inequities worldwide.”

“Our unique collaboration with Biocon began more than a decade ago, even before a biosimilars pathway was defined in most countries,” said Robert J. Coury, executive chairman of Viatris. “During that time, we have experienced many successes, and today is no exception as we join together to create a new, uniquely positioned world class vertically integrated biosimilars leader. This transaction will allow Viatris to continue to participate in the global biosimilars space in a more optimized way, while also allowing us to accelerate our own financial priorities.”

News: India's Biocon beefs up biosimilar portfolio with $3.34 bln Viatris deal, shares fall

Biohaven commits to new epilepsy treatments via $1.24bn acquisition

BY Fraser Tennant

Adding the latest advances in ion-channel modulation to its growing neuroscience portfolio, US neuroscience drug developer Biohaven Pharmaceutical Holding Company Ltd has acquired Channel Biosciences, LLC, a subsidiary of Knopp Biosciences LLC and its Kv7 channel targeting platform, in a deal valued at $1.24bn.

Under the terms of the definitive agreement, Biohaven will make an upfront payment comprised of $65m in Biohaven common shares and $35m in cash to Knopp Biosciences. Biohaven has also agreed to make additional success-based earnout payments.

The Kv7 platform – which provides for the treatment of epilepsy and other neurologic disorders – has been developed and refined for over a decade by a team with deep experience in ion-channel science led by Michael Bozik, chief executive of Channel Biosciences and Knopp Biosciences, and Steven Dworetzky, chief scientific officer at Knopp Biosciences.  

Moreover, the acquisition of the Kv7 platform, along with lead asset BHV-7000, demonstrates Biohaven's continued commitment to neurology and to meeting the unmet needs of these patients. Biohaven intends to bring BHV-7000 to the clinic in 2022, with focal epilepsy as the lead indication for development.

According to the World Health Organization, epilepsy is the fourth most common neurological disorder, affecting more than 50 million people worldwide.

"Kv7 modulators have demonstrated clear efficacy in the clinic but have been limited by off-target effects,” said Mr Bozik. “Our team has developed a portfolio of what we believe are potentially best-in-class Kv7 modulators to deliver novel therapies across several different indications.

“We are proud that Biohaven recognises the potential of this platform,” he continued. “Biohaven was the clear partner of choice, given their demonstrated leadership in neurology and excellence in both developing and commercialising paradigm-shifting treatments for patients."

Upon completion of the transaction, members of Channel Biosciences' scientific team will join Biohaven, adding world-leading ion-channel scientists and driving its mission for bringing novel medicines to patients facing neurologic and neuropsychiatric diseases.

Mr Dworetsky concluded: “We are excited to join Biohaven to accelerate clinical development of BHV-7000 and other drug candidates from our ion channel platform."

News: Biohaven Inks Up To $1.24B Deal For Epilepsy Drug Biz - Law360

Broadcaster Tegna goes private in $5.4bn Standard General deal

BY Fraser Tennant

In a move that takes the broadcaster private, Tegna Inc. is to be acquired by investment firm Standard General in an all-cash transaction valued at $5.4bn.

Under the terms of the definitive agreement, Standard General will acquire Tegna for $24 per share in cash. The transaction has been unanimously approved by Tegna’s board of directors.

Upon completion, Tegna will become a private company and its shares will no longer be traded on the New York Stock Exchange.

“This transaction is the next step in Tegna’s evolution and recognises the value of our portfolio of leading broadcast assets and innovative digital brands,” said Dave Lougee, president and chief executive of Tegna. “We are deeply gratified that Tegan’s new owners value and embrace our purpose to serve the greater good of our communities.”

With 64 television stations in 51 US markets, Tegna is the largest owner of top four network affiliates in the top 25 markets among independent station groups. The company also owns multicast networks True Crime Network, Twist and Quest.

“As long-term investors in the television broadcasting industry, we have a deep admiration for Tegna and the stations it operates,” said Soo Kim, founding partner of Standard General. “We believe Tegna has a strong foundation and exciting prospects for continued growth as a result of the stewardship of the board and the current management team. We look forward to building on the company’s strong foundation and leveraging its deep industry experience to drive further growth.”

Deb McDermott, previously chief executive of Standard Media Group, will become chief executive and Mr Kim will serve as chairman of a new board upon the close of the transaction.

The transaction is subject to approval by Tegna shareholders, regulatory approvals and other customary closing conditions, and is expected to close in the second half of 2022.

Ms McDermott concluded: “Tegna’s stations have earned excellent reputations as leading local content providers and our digital and content assets are a key part of its future in an evolving media landscape.”

News: Standard General to take U.S. broadcaster Tegna private in $5.4 billion deal

Celanese Corp to acquire DuPont unit for $11bn

BY Richard Summerfield

DuPont has agreed to sell most of its mobility and materials unit, including its engineering polymers business line and select product lines within the performance resins and advanced solutions business lines, to Celanese Corporation for $11bn in cash.

The deal, which will see roughly 5000 employees and 29 manufacturing sites move to Celanese, is expected to close around the end of the year, subject to customary closing conditions and regulatory approvals.

The DuPont businesses, which the company earmarked for sale back in November, had total 2021 revenues of $3.5bn and profits before taxes of $800m. The purchase will be a major acquisition for Celanese, which earned $2.8bn before taxes on $8.5bn in revenues in 2021, and will more than double the its engineered materials unit, which had $2.7bn in turnover in 2021.

“The transaction with Celanese that we are announcing today will create a market-leading portfolio serving the automotive, consumer and industrial markets with unmatched scale, manufacturing capability and technical expertise,” said Ed Breen, executive chairman and chief executive of DuPont. “We are proud of the strength of these industry-leading businesses, which we believe will be even stronger when combined with the highly complementary portfolio of Celanese. We are excited for Celanese to partner with the team and we are confident that together they will continue to drive industry-defining material science innovation to serve customers and the value chain.”

“We are excited to welcome our future colleagues from DuPont who have built a world-class product and technology portfolio which is highly regarded in the industry,” said Lori Ryerkerk, chairman and chief executive of Celanese. “Our businesses are highly complementary which will accelerate our growth in high-value applications including future mobility, connectivity and medical.”

The acquisition is expected to complement existing Celanese product lines in polyacetal, ultra-high molecular weight polyethylene, liquid crystal polymers and polyphenylene sulfide. DuPont’s nylon and PBT polymer production will back integrate Celanese’s compounding operations in those businesses. The unit will also extend Celanese’s reach in Asia, helping the company recover some of the presence in the region it relinquished when it sold its stake in the Polyplastics engineering polymer joint venture with Japan’s Daicel. Celanese expects to achieve $450m worth of synergies by integrating DuPont’s polymer businesses with its own within the first four years of deal close.

DuPont plans to use the proceeds of the sale to pay for its pending $5.2bn purchase of the electronic materials producer Rogers Corp, and to finance further acquisitions and share buybacks.

News: DuPont to shed mobility and materials unit in $11 bln Celanese deal