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Australia’s CSL in exclusive talks for $7 billion buyout of Swiss Vifor Pharma

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© Reuters. FILEPHOTO: This is the logo of Vifor Pharma, a Swiss drugmaker. It can be seen in Glattbrugg on November 16, 2020. REUTERS/Arnd Wiegmann

(Reuters) – Australian drugmaker giant CSL (OTC) Ltd was reported by Australian media to have entered exclusive negotiations for Vifor Pharma’s acquisition. The deal would be worth A$10 Billion ($7 Billion). This transaction, Australian media claimed, will increase the shares of Swiss drugmaker Vifor Pharma by a fifth.

According to The Australian Financial Review, reports from The Australian and The Australian that the two companies had been in contact since March and were in advanced discussions, and CSL was doing due diligence on CSL, which is the largest manufacturer of plasma treatment blood plasma, said The Australian Financial Review.

Reports stated that the Swiss drug company made prescription medication and was focused on treating kidney disease at A$10 billion. They did not give any further information about possible deals.

CSL and Vifor Pharma made separate statements stating that they would not comment on speculation.

Morgan Stanley CSL analysts stated in a research report that CSL is seeking diversification due to blood plasma collections. This is where CSL pays individuals to donate blood. It then converts it into treatments. However, COVID-19 restrictions have kept blood plasma levels low.

The Morgan Stanley note stated that diversification was possible, but it might lead to near-term market de-rating before any potential synergies become apparent.

In a note to Jefferies, analysts stated that while the possible buyout could be a “disaster in terms of therapeutic areas for CSL,” it would tie in with their growing kidney transplant franchise.

Vifor’s shares were 21% more at the top Swiss midcap index. CSL shares fell 1% on Friday’s early trading, compared to a slightly lower overall market.

($1 = 1.4083 Australian dollars)

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