Tchibo Moves on Beiersdorf in Bid to Pre-Empt P&G

24 October 2003

Hamburg-headquartered coffee-manufacturer Tchibo Holdings, a 31% stakeholder in German consumer products company Beiersdorf, is set to launch a formal bid for the latter - within whose global brand portfolio is the Nivea skincare range, for long ogled by America's Procter & Gamble.

The key to the bid is held by compatriot insurance giant Allianz which owns 44% of Beiersdorf. An offer of around €125 a share ($147.38; £87.10) will be dangled before Allianz by a Tchibo-led consortium [WAMN: 14-Oct-03]. This represents a 16% premium on Beiersdorf's closing price Wednesday of €107.75

The consortium, which includes Beiersdorf itself and Hamburg's state investment vehicle Hamburger Gesellschaft für Beteiligungsverwaltung, has clearly been assembled with the intention of thwarting any takeover plan by P&G. Many in the region fear a successful P&G bid would divert jobs from Germany to lower-cost centers elsewhere on the globe.

But heading-off P&G at the pass might be an optimistic hope given the depth of the US titan's pockets. A lengthy takeover battle could ensue.

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Tchibo announced it had succeeded in acquiring a further 40% of the equity in Beiersdorf which, added to its existing 31% holding, gives it an unassailable 71% in the manufacturer of Nivea skincare and other consumer products.

Around €4.4 billion ($5.19bn; £3.06bn) changed hands in the deal with Allianz, which effectively spikes Procter & Gamble'a guns so fare as a takeover - hostile or otherwise - is concerned. The price paid represents a premium of over 20%on Beiersdorf's closing price Wednesday of €107.75 a share.

Data sourced from: Financial Times; additional content by WARC staff