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UPrivate equity firm Clayton, Dubilier & Rice has agreed to buy London-listed UDG Healthcare Plc in a softened offer of around £ 2.8bn ($ 3.9bn) in cash, after have obtained the support of key shareholders.
The price stands at 1,080 pence per share, the companies said today.
Last week, CD&R said it was considering increasing its bid to this level after some of UDG’s biggest investors complained that a previous bid was too low.
CD&R said the new improved offering had the backing of UDG’s largest shareholder, Allianz Global Investors, who had criticized the initial offer as “opportunistic,” as well as Kabouter Management LLC. No mention was made of activist investor Elliott Investment Management, who recently acquired a position in UDG.
Opposition to the initial offer reflects a wider concern that private equity firms are taking advantage of falling stock valuations due to Brexit and the pandemic to try to buy companies for less than they are worth .
CD&R has also set its sights on WM Morrison Supermarkets Plc, making an approach with a proposed offer of £ 5.5 billion. The supermarket rejected the award, saying it significantly undervalued the company.
Shares of UDG, which provides a range of services to pharmaceutical customers in around 25 countries, rose 0.5% to 1,071 pence on the FTSE 250. The stock has climbed 37% this year.