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Abbott Labs Sued by Alere over Pending $5.8B Acquisition
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Abbott Laboratories’ (ABT - Free Report) agreement to acquire Alere Inc. came into the spotlight after Alere announced that it has sued Abbott Labs in an attempt to close the pending takeover worth $5.8 billion.
Alere filed a complaint against Abbott Labs in the Delaware Chancery Court, seeking to force Abbott Labs to take all the necessary actions to obtain anti-trust approvals and fulfill its obligations under the terms of the merger agreement.
A redacted version of the complaint is expected to be disclosed next week.
Note that in Jan 2016, Abbott Labs entered into a definitive agreement to acquire Alere. As per terms of the agreement, Abbott Labs would pay $56 per common share in cash to Alere shareholders upon the completion of the transaction. Also, the company would assume/refinance Alere’s net debt of $2.6 billion.
However, eventually, Abbott Labs became reluctant to complete the deal and had even requested to call it off in Apr 2016. The company informed Alere that it has serious concerns regarding the accuracy of various representations, warranties and covenants made by Alere in their merger agreement. It had also agreed upon paying the legal costs in the range of $30–$50 million in respect to Alere’s transaction expenses, which was rejected by the latter.
We expect investors to focus on further updates regarding the Alere acquisition from Abbott Labs.
Abbott Labs currently has a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the health care sector include Actelion Ltd. and ANI Pharmaceuticals, Inc. (ANIP - Free Report) . Both the stocks sport a Zacks Rank #1 (Strong Buy).
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Abbott Labs Sued by Alere over Pending $5.8B Acquisition
Abbott Laboratories’ (ABT - Free Report) agreement to acquire Alere Inc. came into the spotlight after Alere announced that it has sued Abbott Labs in an attempt to close the pending takeover worth $5.8 billion.
Alere filed a complaint against Abbott Labs in the Delaware Chancery Court, seeking to force Abbott Labs to take all the necessary actions to obtain anti-trust approvals and fulfill its obligations under the terms of the merger agreement.
A redacted version of the complaint is expected to be disclosed next week.
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Note that in Jan 2016, Abbott Labs entered into a definitive agreement to acquire Alere. As per terms of the agreement, Abbott Labs would pay $56 per common share in cash to Alere shareholders upon the completion of the transaction. Also, the company would assume/refinance Alere’s net debt of $2.6 billion.
However, eventually, Abbott Labs became reluctant to complete the deal and had even requested to call it off in Apr 2016. The company informed Alere that it has serious concerns regarding the accuracy of various representations, warranties and covenants made by Alere in their merger agreement. It had also agreed upon paying the legal costs in the range of $30–$50 million in respect to Alere’s transaction expenses, which was rejected by the latter.
We expect investors to focus on further updates regarding the Alere acquisition from Abbott Labs.
Abbott Labs currently has a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the health care sector include Actelion Ltd. and ANI Pharmaceuticals, Inc. (ANIP - Free Report) . Both the stocks sport a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>