The below is from page 99 of the as-amended SEC filing. As is often true, here, what is NOT there -- is arguably more important than what IS.
What is missing is any indication that Merck and Schering-Plough have even "started the clock" (made a regulatory filing) with the EU authorities. I am still searching, but it appears that this 200-plus page mammoth SEC filing makes literally no mention of an actual EU filing having occurred yet. Take a look:
. . . .European Union
Both Merck and Schering-Plough sell products to customers based in the European Union. The EC Merger Regulation requires notification of and approval by the European Commission of mergers or acquisitions involving parties with worldwide sales and European Union sales exceeding given thresholds. Merck and Schering-Plough will file a formal notification of the transaction with the European Commission as promptly as reasonably practicable and advisable. The European Commission will have 25 business days after receipt of the formal notification, which period may be extended by the European Commission to up to 35 business days in certain circumstances, to issue its decision regarding the merger. If, following this phase I review period, the European Commission determines that the merger raises serious competition concerns, it would initiate a phase II investigation. The basic period for a phase II investigation is 90 business days, which may be extended to up to 105 business days if remedies are offered by the parties on or after the 55th day of the investigation. An additional further extension of 20 business days can also be sought in certain circumstances. . . .
But no mention of any EU filing, yet -- and it is mid-June 2009. Doesn't something like 50 percent of the combined companies' pro-forma sales flow through EU-member countries? Yep -- I think that's true.
That August 7, 2009 date is looking more and more like a stalking-horse, to me. . . .
2 comments:
Condor:
I am wondering if they are waiting to file in the EU until a decision is made on animal health. A large portion of animal health believes that the decision of what to sell and what to keep will be made within the next 30 days.
I think that makes a lot of sense.
And, assuming your surmise is correct, a first filing at the European Commission on say July 30 -- makes an August 7, 2009 shareholders' meeting date nowhere near the end of the process.
And that is fine -- the shareholders may be asked to approve the deal, then -- but what if the EU authorities want additional changes/divestitures, spin-offs? That would be cumbersome, to say the least, post August 7, 2009.
Presumably, if those EU requests are material -- and fall outside the AH businesses -- then the lawyers will likely advise that the new terms need to be approved by the shareholders.
And that is rather inefficient.
Thus my suggestion that August 7, 2009 is a stalking horse date -- to try to create momentum, with regulators, where little momentum may presently exist.
Add to all of the above that no one really knows just how "reinvigorated" the U.S. Anti-Trust authorities feel about mergers with anti-competitive potential, under President Obama's populist agendas. Sch-Merck could still receive a whopper of a Second Request, under Hart-Scott, here in the states.
Namaste, and thanks for the insights!
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