Novartis completes purchase of minority stake in Alcon

HUENENBERG, Switzerland — Novartis AG and Nestlé S.A. have completed the first step purchase and sale of 74 million shares of Alcon's common stock, Alcon announced in a press release. The stock is currently owned by Nestlé pursuant to the agreement the companies reached in April.

As a result of this first phase transaction, Nestlé remains Alcon's majority shareholder with approximately 52% of Alcon's issued capital. Novartis now has a minority stake in Alcon equal to approximately 24.85% of Alcon's issued capital, according to the release.

In addition, Alcon has added James Singh, Nestlé's executive vice president and chief financial officer, and Daniel Vasella, MD, Novartis' chairman and chief executive officer, to its board of directors. The expansion of the board from eight to 10 members was approved by shareholders at Alcon's 2008 annual general meeting, the release said.

Under the terms of the agreement, Novartis has a call option to purchase Nestlé's remaining Alcon common shares. The agreement also provides Nestlé with a put option to sell its remaining Alcon common shares to Novartis.

These options commence on January 1, 2010, and expire on July 31, 2011. Under the closing conditions of the agreement — which include regulatory approval — if either of these options are exercised, Novartis would become the majority shareholder of Alcon with approximately 77% of its issued shares, according to the release.