Boots backs KKR's £10.6 billion takeover bid

Our Corporate Bureau
20 April 2007

The board of Europe''s largest pharmacy retailer, Alliance Boots, has backed a £10.6-billion takeover bid after private equity firm Kohlberg Kravis Roberts (KKR) and Boots'' billionaire deputy chairman Stefano Pessina raised their offer to £10.90 per share.

The offer is 33.7 per cent over the price of Boots shares the day before the first approach was made.

Pessina already owns a 15-per cent stake in the retailer. If the shareholders of the company approve, Boots would become the UK''s biggest acquisition by a private equity fund.

Private equity group Terra Firma and medical charity the Wellcome Trust had earlier said they were considering a rival takeover bid for Alliance Boots.

Alliance Boots was created in a £7-billion tie-up with chemist chain Alliance Unichem and Boots Healthcare International last year. It owns 3,000-pharmacy stores, of which 2,600-''Boots the Chemist'' shops are in the UK alone, and supplies more than 125,000 pharmacies, health centres and hospitals.

KKR first made an approach in early March with a £9.7-billion offer, but was rebuffed because the offer price was too low.