syb bidding...the age

Symbion promises to make Sigma pay more for API
Email Print Normal font Large font Nabila Ahmed
November 24, 2006


Symbion CEO Robert Cooke.
Photo: Jessica Shapiro

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AdvertisementSYMBION Health wants to make rival Sigma Pharmaceuticals pay a high price for pharmacy wholesaler Australian Pharmaceutical Industries.

Symbion has been touted as a rival bidder for API, which is considering a $643 million offer from Sigma. But Symbion has not yet decided on a bid.

"If we weren't the successful party, the best outcome for us is for someone else to pay the most that we can make sure they do," Symbion chief financial office Mark Hooper said. He said Symbion would benefit from industry consolidation regardless of whether it participated in the deal. It expected to increase its market share by 5-15 per cent to up to 45 per cent if Sigma and API merged.

But Symbion would not rule out bidding for API, believing it did not have to make an offer until well after Sigma and API reached terms of agreement.

It is likely Sigma, which increased its offer to $2.50 a share last month, would demand an exclusive due-diligence agreement to protect itself against rivals. API and Sigma have been in talks for three weeks, with both hoping for a deal before the end of the year. API wants a scrip option to Sigma's all-cash offer.

Symbion chief executive Robert Cooke said the company was on track to deliver on its fiscal 2007 guidance of earnings before interest and tax, post-securitisation, of $180-$190 million, representing growth over the previous year of 13-19 per cent.

Symbion gained