Rhone-Poulenc S.A. has taken another step to expand itspresence in the health-care field, negotiating to acquire theremainder of Institut Merieux.
The company announced Friday that it is in discussions for amerger to increase its current stake in the institution to 100percent from 51 percent.
"This transaction will strengthen Rhone-Poulenc's healthbusiness in the strategically important and fast-growing area ofpreventative medicine," the company stated. "Institut Merieux,through its subsidiary Pasteur-Merieux Serums et Vaccins, theworld leader in vaccines, has significant growth potential, but ithas confronted an increasingly challenging world environmentcompelling it to create new alliances."
Institut Merieux and its subsidiary comprise the bulk ofRhone-Poulenc's (NYSE:RP) health sector, which constitutes 37percent of the French chemical company. Pasteur MerieuxSerums et Vaccins also includes Connaught Laboratories andTransgene.
Rhone-Poulenc purchased Canadian vaccine developerConnaught in 1989 and acquired 70 percent of the Frenchcompany Transgene in 1986; Rhone's stake in the latter is now61 percent.
Rhone-Poulenc Rorer, the pharmaceutical arm of the company,comprises the remainder of the health sector. Rhone-Poulencacquired 68 percent of Rorer in 1990.
Rhone-Poulenc said the minority shareholders in InstitutMerieux will receive in exchange for their shares in Merieuxshares of Rhone-Poulenc S.A. issued through a capital increaseafter the privatization of Rhone-Poulenc. The company expectsto propose to the board of directors and shareholders of thetwo companies an exchange ratio of approximately 77 Rhone-Poulenc S.A. ordinary shares for five Institut Merieux ordinaryshares.
The proposed merger follows on the heels of Rhone-Poulenc'spurchase of 37 percent of Applied Immune Sciences Inc. inJune for $113 million. The Paris-based company has the rightto boost its stake in AIS to 60 percent by June 1997.
Rhone-Poulenc also owns a stake in two other U.S.biotechnology companies. In 1986 it purchased 80 percent ofVirogenetics Corp. of Troy, N.Y., and Rhone-Poulenc Rorer owns9.6 percent of Immune Response Corp. of Carlsbad, Calif.Rhone-Poulenc Rorer and Immune Response formed a jointventure, Immunization Products Ltd., which is developing JonasSalk's AIDS vaccine.
Among other agreements, Pasteur-Merieux has a 1991partnership with Merck & Co. Inc. to develop human vaccines.
-- Brenda Sandburg News Editor
(c) 1997 American Health Consultants. All rights reserved.