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- Publication:2012/11/19
The aggressive diversification campaign of Bayer CEO Marijn Dekkers has been checked, at least temporarily, by Reckitt Benckiser Group, which has moved on Schiff Nutrition International with a bid of its own.
The British consumer goods maker of such products as Durex condoms anted up $1.4 billion, or $42 a share, for Schiff, $200 million more than Bayer's $1.2 billion offer made last month, Reuters reports. Bayer had no comment but the Reckitt move sets the stage for a bidding war for the vitamin maker.
While vitamins and supplements lack the same profit margins as branded drugs, they are a growing market and don't carry the development costs and same level of regulatory oversight as medications. Schiff has in its cupboards such products as Airborne brand of cold-prevention products and Tiger's Milk nutrition bars.
Dekkers was headed in the same general diversification direction as some peers at companies like GlaxoSmithKline ($GSK) with its line of sports drinks and Valeant Pharmaceuticals ($VRX), which recently grabbed a Brazilian supplements maker. Dekkers added to Bayer's animal health business recently by agreeing to pay Teva Pharmaceutical Industries ($TEVA) $145 million for its animal health business.
Given the size of this deal and the unknowns of an auction, this move by Reckitt Benckiser will test Dekkers resolve on diversification.