Rhone-Poulenc and Hoechst Shareholders Vote in Favor of Merger

Yesterday, Rhone-Poulenc shareholders voted overwhelmingly in favor of a merger with Hoechst, a move that will create one of the world's largest life sciences companies. The Paris meeting saw an impressive 99.5 per cent of shareholders approve the resolution, with all proposed resolutions securing more than 97 per cent approval. This decisive vote marks a significant step towards the creation of Aventis, with Hoechst shareholders set to vote on the merger tomorrow. The merged entity is expected to employ 90,000-95,000 people and generate close to $20 billion in turnover.

Key Takeaways:

• Shareholders of Rhone-Poulenc approved the merger with Hoechst with an overwhelming 99.5 per cent vote, marking a crucial step towards the creation of Aventis.
• The merger will result in a company with 90,000-95,000 employees and turnover of close to $20 billion.
• Hoechst will demerge a significant portion of its industrial businesses, including Celanese, Ticona, Nutrinova, and Trespaphan, before launching the exchange offer.
• Hoechst shareholders will receive €1.5 billion ($1.53 billion) in special dividends, conditional on the successful implementation of the Aventis transaction.
• Hoechst will also repurchase 29 million of its own shares prior to the exchange offer, equivalent to approximately 5 per cent of its subscribed capital.
• The pro forma ownership of Aventis will consist of 47 per cent for Rhone-Poulenc shareholders and 53 per cent for Hoechst shareholders.
• Rhone-Poulenc's shares closed down 0.64 per cent on the weak Paris market, while Hoechst rose 1.34 per cent.

Statistics:

• 99.5 per cent: Shareholders in favor of the Rhone-Poulenc-Hoechst merger
• 97 per cent: Approval rate for all proposed resolutions
• 90,000-95,000: Expected number of employees in the merged entity
• $20 billion: Expected turnover for the merged entity
• €1.5 billion: Special dividend for Hoechst shareholders
• $1.53 billion: Special dividend for Hoechst shareholders in USD
• 5 per cent: Percentage of subscribed capital equivalent to Hoechst shares to be repurchased
• 29 million: Number of Hoechst shares to be repurchased
• 47 per cent: Pro forma ownership stake of Rhone-Poulenc shareholders in Aventis
• 53 per cent: Pro forma ownership stake of Hoechst shareholders in Aventis

Sources:

• Financial Times Limited 1999. All Rights Reserved.