Racing to transform

Europe's recent wave of consolidation amongst its mid-cap pharma businesses continued last week with the proposed E4.4 billion ($5.6 billion) cash and stock acquisition of Schwarz Pharma AG by UCB Group S.A. Both companies have been trying to evolve from specialty pharma/generic hybrids into full-fledged biopharmaceutical companies, but the internal process clearly was not quick enough. By merging, the companies are hoping to accelerate the transformation in a sustainable way.

Last Monday, in the third major European mid-cap pharma consolidation announcement in as many working days, UCB proposed to acquire Schwarz for E50 cash and 0.8735 of a UCB share for every Schwarz share owned, which comes to E91.1 a share on the day offered. The offer represented a 20% premium to the previous day's close and a 50% premium to the price Schwarz was trading at a year earlier.

For UCB (Euronext:UCB, Brussels, Belgium), the move provides pipeline opportunities in the next two to three years - just as the company faces generic challenges to its

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