Solvay makes friendly bid for France's Rhodia
Belgian chemicals and plastics group Solvay said Monday it was making a friendly takeover bid for its French rival Rhodia worth 3.4 billion euros ($4.8 billion) to create a world leader in the sector.
Solvay said it was offering 31.60 euros per Rhodia share, a premium to the closing share price on Friday. In Paris, Rhodia shares jumped nearly 50 percent to 31.55 euros in early trade while the overall market was down 0.23 percent.
Solvay said it would fund the offer wholly through its own resources and its financial structure would remain solid as a result. The company earned 5.2 billion euros from the recent sale of its pharmacy division to Abbot.
The Belgian company said the bid was agreed by the two boards, making it a friendly offer, adding that the deal would boost earnings from the first year.
A combined Solvay-Rhodia would have annual sales of 12 billion euros, with an increased exposure to Asia while the deal itself should bring annual cost savings of 250 million euros within three years.
© 2011 AFP