Novartis tenders full merger proposal to Alcon

HUENENBERG, Switzerland — Novartis has exercised its option to purchase the remaining shares in Alcon owned by Nestle in a cash transaction priced at $180 per share, Alcon announced in a press release. Once the purchase is completed, Novartis would own a majority stake in Alcon of approximately 77% of the company's issued shares.

Novartis has also submitted a proposal to purchase the remaining 23% publicly held minority interest in Alcon at a price of $153 per share, pursuant to which the two companies would merge under Swiss merger law. If the sale is approved, minority holders of Alcon's publicly held shares would receive 2.8 Novartis shares for each of their shares of Alcon stock.

Among other stipulations, the proposed merger would be subject to approval by Alcon's board of directors, the closing of the sale option between Novartis and Nestle, as well as the completion of certain regulatory approvals, according to the release.

An independent director committee of Alcon's board of directors, which was enacted in 2008 to evaluate Novartis' initial purchase of approximately 25% of Alcon's publicly traded shares, is currently evaluating the terms of the proposed merger. The committee has already noted that Novartis' $153 per-share valuation of Alcon stock represents an approximate 15% discount compared with the call price of $180 Novartis plans to tender Nestle for its 52% interest in Alcon, the release said.

Novartis estimates the total value of the proposed merger to be approximately $38.5 billion, according to a separate press release from the company.