Novartis to purchase stake in Alcon

Novartis is looking to strengthen its healthcare portfolio with the acquisition of a 25 per cent stake in Alcon from Nestle.

Under the terms of the definitive agreement, Novartis will acquire a quarter of the company for a total sum of $11 billion (5.5 billion pounds), equal to $143.18 per share, with the deal expected to close in the second half of this year.

Furthermore, Novartis also retains the right to acquire a 77 per cent majority ownership of Alcon in two steps.

Alcon is a leader in pharmaceutical, consumer and surgical eye care products, which fits with the existing contact lens and ophtha pharmaceutical businesses at Novartis, with the firm forecasting the realisation of synergies with these units in time.

Dr. Daniel Vasella, chairman and chief executive officer of Novartis, said: “This acquisition furthers our strategy of accessing high-growth segments of the healthcare market while balancing inherent risks.”

He added that the strategic fit of the firm will result in research and development synergies and complementary product portfolios, while eye care is a market that is set to grow dynamically as a result of the ageing world population.

In February 2008, Novartis announced the opening of a new research institute in Siena to focus on the development of vaccines aimed at the developing world.