Robins Changes Suitors, OKs American Home Bid

From Reuters

A. H. Robins Co., once again switching suitors, said Tuesday that it has accepted a revised takeover offer from American Home Products Corp. in a stock-swap deal valuing Robins at $700 million.

Last week, Robins' shareholders group said they backed American Home Products' bid, which had been sweetened from $600 million. The new offer by American Home Products--the New York-based maker of Anacin and Dristan--began a new round of bids Monday from other suitors for Robins, which has been operating under bankruptcy protection since 1985.

Robins had accepted a merger proposal from France's Sanofi S.A., France's second-largest drug company. Sanofi agreed to pay $600 million for 58% of Robins and to guarantee bank loans for a $2.475-billion trust to compensate those injured by Robins' Dalkon Shield contraceptive device.

Claimants Support Bid

The Dalkon Shield claimants committee also said Tuesday that it supported American Home Products' bid. The group has opposed bids made by Rorer Group Inc. and Sanofi, criticizing them for failing to provide full and prompt payment of their claims in cash.

"The committee is pleased that American Home Products has come forward with a proposal which will facilitate the prompt compensation of the Dalkon Shield victims, and the committee has accepted the proposal," Murray Drabkin, the group's lawyer in Washington, said.

The American Home Products proposal would provide for either a single payment of $2.375 billion in cash to the Dalkon Shield trust on the effective date of the reorganization plan or the sum of $2.475 billion paid within one year of the effective date of the plan.

Robert Miller, a New York lawyer for the shareholder group, said, "The equity committee has enthusiastically reaffirmed its endorsement of the American Home Products plan, which now has the support of all of the major parties and looks forward to an expeditious plan confirmation."

A Sanofi spokesman in New York said company officials were traveling back to France and were not available for comment. A Rorer spokesman could not be reached for comment.

Robins sought Chapter 11 bankruptcy protection because of massive lawsuits by women injured by the Dalkon Shield. The device has been linked with deaths and serious injuries. Robins makes prescription drugs and well-known over-the-counter products that include Chap Stick lip balm.

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