(Reuters) - United States based Versum Materials on Thursday unveiled a plan to prevent a hostile takeover in the face of an unsolicited $5.9 billion offer from Germany’s Merck.
Merck on Wednesday said it would pay $48 per Versum share in an all-cash offer designed to scotch a separate $4 billion all-stock takeover from U.S. rival Entegris.
Merck, however, has stopped short of launching a formal takeover for Versum that would appeal directly to shareholders.
Following Merck’s offer, Versum unveiled a “Rights Plan” on Thursday which it said was designed to ensure no shareholders are disadvantaged.
“The Rights Plan is intended to promote the fair and equal treatment of all Versum shareholders and ensure that no person or group can gain control of, or influence over, Versum, through open market accumulations or other tactics,” Versum said in a securities filing.
Versum said its shareholder plan gives all shareholders the right to purchase stock at a reduced price, if a potential bidder buys up 12.5 percent or more of Versum’s common stock.
“Rights held by the triggering entity will become void and will not be exercisable to purchase shares at the reduced purchase price,” Versum said about its plan.
Merck declined to comment.
Lazard served as financial adviser to Versum and Simpson Thacher, while Bartlett LLP was the legal counsel.
Reporting by Ankit Ajmera in Bengaluru and Alexander Huebner in Munich; Editing by James Emmanuel and Elaine Hardcastle