The CSL Limited (ASX: CSL) share price is underperforming on Monday.
In morning trade, the biotherapeutics company’s shares are down ever so slightly to $297.89.
This is despite the company responding to mergers and acquisition (M&A) speculation this morning.
CSL confirms acquisition talks
This morning CSL finally confirmed that it is interested in acquiring Swiss based biotechnology company Vifor Pharma.
Earlier this month, there was speculation that CSL was in talks with Vifor Pharma. However, in response to this speculation, management downplayed any impending deals being made.
It commented: “CSL regularly assesses strategic opportunities that can improve its business, improve the health of people around the world and provide value to shareholders. There is no certainty that any transaction will result from CSL’s consideration of such opportunities and, if any transaction does result, when such a transaction would occur.”
This rhetoric changed slightly on Monday after further reports claimed that a deal was close to being made.
On this occasion, management responded by saying: “CSL confirms that it is in discussions with Vifor Pharma Ltd regarding a potential transaction, however at this time there remains no certainty that any transaction will result and, if a transaction does result, when such a transaction would occur.”
What would a deal look like?
Previous speculation suggested that CSL would look to acquire the iron deficiency, nephrology and cardio-renal therapies developer for $10 billion.
Were a deal to be made for Vifor Pharma, the reports indicated that CSL would look to part-fund the deal with a capital raising. A figure of $3 billion to $4 billion has been touted with the balance being covered by its existing cash reserves, debt facilities, or shares.
Though, whether an agreement is ultimately signed, only time will tell. But things certainly appear to be progressing, so all eyes will be on the CSL share price in the lead up to 2022.
The post CSL (ASX:CSL) share price lower after responding to M&A speculation appeared first on The Motley Fool Australia.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended CSL Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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