CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

Sigma Healthcare shares drop as leading Australian Pharmaceutical distributor proposes a merger

Shares of pharmaceutical company Sigma fell upon news of a possible merger with leading pharma distributor API

Zena Chamas

Publication date : 2018-12-14T00:13:21+0000

API mergers with Sigma

Leading drug distributorAustralian Pharmaceutical Industries Ltd (API) offered A$727 million to Sigma healthcare.

API announced its proposal to buy Sigma on Friday, offering A$0.686 per Sigma share, and API shareholders owning 63% of the combined entity if the deal was to go ahead.

API already owns Australia’s leading pharmacy and beauty supply chain, Priceline and Priceline Pharmacy, while Sigma owns lesser-known pharmacy companies Amcal, Chemist King, Guardian and Discount Drug stores.

If the deal was to go ahead, API would own the majority of Australia’s leading healthcare pharmacies. API already owns a 13% share in Sigma healthcare limited.

API says it intends to ensure that it holds strategic options in the future shape of the healthcare industry.

“API’s preference is to take the next steps with Sigma so that all shareholders can share in the benefits of a merged entity. The NBIO is conditional on, among other things, completion of due diligence and ACCC clearance.” API said in a statement.

If an agreement is reached with Sigma it will go through regulatory processes that could run throughout 2019.

API will now await engagement with the Sigma Board to allow the full merger to be reviewed.

Sigma Pharmaceutical shares fall

Sigma Healthcare Ltd shares have fallen upon the proposed merger, dropping up to 3.5% at time of writing on Friday.

Analysts predict the shares to continue to drop upon the news.

While API shares remained strong and unaffected by the announcement, healthcare stocks were down 0.7% just after open on Friday.

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This information has been prepared by IG, a trading name of IG Markets Limited and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. International accounts are offered by IG Markets Limited in the UK (FCA Number 195355), a juristic representative of IG Markets South Africa Limited (FSP No 41393). South African residents are required to obtain the necessary tax clearance certificates in line with their foreign investment allowance and may not use credit or debit cards to fund their international account.

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