Novartis, Nestle Agree to $39B Deal on Alcon

Two-step deal would give Swiss pharma a majority stake in the eye-care company
By Jim O'Neill,  Newser User
Posted Apr 7, 2008 7:11 AM CDT
Swiss pharmaceutical giant Novartis has agreed to acquire an $11 billion stake in the ophthalmic firm Alcon from Nestle.   (AP Photo/Keystone, Gaetan Bally)
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(Newser) – Nestle and pharma giant Novartis continued swapping brands today, with Novartis, which sold Gerber to Nestle last year, agreeing to pay $39 billion for a 77% stake in eye-care company Alcon, reports the Wall Street Journal. The two-step deal—Novartis will pay $11 billion for 74 million shares this year and buy the remaining shares by 2011—is among the largest in Swiss history.

Novartis, which also owns contact lens-maker Ciba Vision, will pay $143.18 a share for the initial stake—about a 5% discount—and pay $181 per share between January 2010 and July 2011 for the remaining shares. Alcon closed Friday at $148.44. Alcon had sales of $5.6 billion and a profit of $1.6 billion in 2007.