CENTRAFARM LEVERAGED BUYOUT GROUP OFFER OF $ 109.1 MIL. for the Benelux drug manufacturer and distributor was accepted by the Centrafarm board of directors Feb. 2. The company announced that its board of managing directors and a board of supervisory directors "accepted an offer from its principal shareholders to engage in a transaction which would result in the liquidation of the company and the payment to unaffiliated shareholders of a liquidating distribution in cash . . . in the amount of $ 12.50 per share." Centrafarm had reported in January that it was considering going private at a cost of approximately $ 100 mil. through an $ 11 a share offer. The proposed transaction, Centrafarm noted, involves the sale of assets to a new entity comprised of management, Warburg Pincus Associates, Alta-Berkeley Limited Partnership, and "certain related investors." The sale of assets would be followed by a liquidation of the company. A shareholder meeting is scheduled for March 8 to vote on the proposal. The buyout group controls about 46% of outstanding Centrafarm shares with the two venture capital firms Warburg and Alta-Berkeley together holding "approximately 35%" of outstanding stock. Other investors, who will be invited to join in the formation of the new company, will hold about 11%. The buyout offer represents a 27% premium over Centrafarm's 1987 closing bid price of $ 9.875, but is well below the stock's 1987 peak at 16. Based on Centrafarm's just-announced sales and earnings in 1987, the buyout group is offering about 18 times net earnings. Centrafarm sales in 1987, translated from Dutch guilders to dollars, were $ 96.9 mil., up 19.6%, with net earnings increasing approximately 14% to $ 6.1 mil. Located in Etten-Leur, the Netherlands, Centrafarm manufacturers and markets ethical, OTC and generic drugs primarily in Belgium and the Netherlands, and to a lesser extent in W. Germany. The company operates in Belgium through its A. Christiaens, Eurogenerics, and Sanders-Probel subsidiaries, and in the Netherlands through Centrafarm Nederland B.V. (formerly Holdfarm).
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