(Novartis) Roche will buy its almost one-third voting right or 53.3 million shares in rival Novartis AG for $20.7 billion.
The shares, priced at $388.99 or 356.93 Swiss francs, means that Novartis will lose its influence in Roche.
Roche targets debt to finance the deal and will cancel repurchased shares to regain “full strategic flexibility.”
Novartis CEO Vas Narasimhan says the transaction is consistent with the company’s strategic focus and will use the proceeds in line with its capital allocation priorities.
Roche shareholders are now expected to vote on the deal at the November 26 meeting.
Novartis acquired the stake in Roche at around $5 billion between 2001 and 2003 and will earn about $14 billion from the sale.
RO: SWX is up +2.38%, NOVN: SWX is up +1.73%
