Chiron shareholders put seal on Novartis deal

As all regulatory approvals for the takeover have already been received, Chiron said that it expects the transaction to be completed before the end of Thursday 20th April. Novartis will therefore acquire the 56% of shares in the US vaccine maker that it does not already own.

After a $40 per share bid for Chiron was rejected in September 2005, Novartis quickly came back with a $45 per share offer which was accepted by Chiron's board. Although the boards of the companies had entered into a definitive merger agreement, the deal was held up by some of Chiron's major shareholders who argued that the proposed transaction still undervalued the company.

In an effort to appease these shareholders and smooth the completion of the deal, Novartis recently upped its bid for the US biotech company to the $48 per share deal which has now received shareholder approval.

The original Novartis bid in 2005 came at a time when the Chiron share price was depressed after contamination problems caused the company to halt production and sales of its flu vaccines Fluvirin and Begrivac. It was widely reported that Novartis hoped to acquire Chiron at a relatively low price due to the problems it was having at the time.