Analysis and Commentary

Biotech giant CSL in massive global takeover

Analysis and Commentary

Analysis by Peter Roberts

Australia’s largest and most successful manufacturer, global blood products and vaccine powerhouse CSL, is to raise billions from investors to execute a $17.2 billion all cash takeover of a complementary healthcare business, Swiss pharmaceutical manufacturer Vifor.

The massive takeover expands CSL’s global footprint into complementary areas including haematology, thrombosis, cardiovascular and transport treatments, as well as delivering a high quality R&D development pipeline.

CSL is already Australia’s biggest innovator, spending more than $1 billion annually on R&D and, at various times over the past few years, has been the country’s most valuable by market capitalisation on the ASX.

Trading this morning at $297.27, CSL is valued at $135.45 billion.

The Vifor board of directors have unanimously recommended acceptance of the CSL bid, with its largest shareholder Patinex AG agreeing to sell its 23.2 per cent stake.

CSL will pay for the transaction through a $6.3 billion share placement to institutions, a $750 million share purchase plan and new debt.

Chief executive Paul Perreault was asked at a media event if the company had over-paid for Vifor.

He said: “It is a great deal because of the growth potential we have with both organisations.”

Perrault is only CSL’s second CEO after Brian McNamee first led the company which was privatised in 1994 by the then labour government.

Considered scientifically excellent but a business basket case, McNamee took CSL global in blood-derived products and influenza vaccines, and turned a public service culture into an agile and innovative one.

Now Perreault has taken the next step, significantly building the company whose hallmark is a pipeline of lifesaving products and research opportunities.

He said: “Vifor Pharma enhances CSL’s patient focus and ability to protect the health of those facing a range of rare and seriuous medfical conditions.

“It brings an outstanding team and a leading portfolio of products.”

Picture: Paul Perreault

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