Hungary Plans To Privatize Its Richter Gedeon Drug Holdings

The Hungarian Privatization and State Holding Company (APV Rt) plans to sell the nearly 4.7 million shares it holds in Richter Gedeon Vegyeszeti Gyar Rt., Hungary's leading drug manufacturer. APV RT announced a "single turn, open tender" to find a

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The Hungarian Privatization and State Holding Company (APV Rt) plans to sell the nearly 4.7 million shares it holds in Richter Gedeon Vegyeszeti Gyar Rt., Hungary’s leading drug manufacturer.

APV RT announced a “single turn, open tender” to find a licensed investment service company for the proposed privatization. The sale would be accomplished in one or more installments, with private placement for Hungarian and foreign institutional investors and via public issuance for the Hungarian market, APV Rt said.

APV Rt. holds 4,659,373 Richter shares with a face value of HUF 1,000 each.

APV Rt said the bidder should submit an obligatory price offer for the whole share packet. After the sale of the first tranche, the fee for the remaining portion cannot be higher than the submitted offer. APV Rt. reserves the right to announce a new tender for the remaining portion.

The aim of the tender is threefold: “to maximize privatization income; to help to carry on Richter’s strategy; and to assure the state’s influence in the company over the immediate future (preferably for at least five years)”, APV Rt said.

APV Rt. in cooperation with Richter will decide on the terms and conditions with regard to the company chosen to handle the sale and other participants involved, based on the bidder’s offer.

Only internationally acknowledged financial institutions, investment companies and banks with operating licenses can participate in the tender, APV Rt said. Syndicated offers will not be accepted. The Hungarian public issue can only be arranged by investment companies and financial institutions with seats in Hungary, or by the Hungarian subsidiaries of international financial service providers. In their offer, bidders should list the planned co-operators of the project, and the prospective aim and scale of their involvement, as well as planned legal advisors. References from the pharmaceutical industry and capital market are advantages, said APV Rt.

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