Ciba To Take 49.9% Stake In Chiron

Ciba of Switzerland is acquiring a 49.9% stake in one of the USA's most successful biotechnology companies, Chiron Corporation. The deal involves Ciba acquiring 11.9 million shares at a price of $117 per share, representing a 37.7% stake, and an exchange of Ciba's interest of 50% in the two companies' vaccines joint venture, Biocine, and Ciba's worldwide diagnostics business, Ciba Corning, going to Chiron for 6.6 million shares.

Ciba Corning Diagnostics will continue to operate as a separate division of Chiron, with president William Zadel staying in place. $100 million in debt will remain on the CCD balance sheet.

Ciba currently owns 1.4 million shares in Chiron which will increase after the deal to around 20 million for a total investment of around $2 billion. Chiron has the option to issue Ciba up to $500 million in new equity and Ciba has agreed to guarantee $425 million of new debt for Chiron. After five years Ciba can increase its stake in Chiron to a majority holding of 55%.