November 4, 2021 – Novartis announced it has agreed to sell 53.3 million (approximately 33%) Roche bearer shares in a bilateral transaction to Roche for a total consideration of $20.7 billion.
The deal announced Thursday hands Novartis a war chest for potential acquisitions, while for Roche, it removes a major competitor from its shareholder register and will boost earnings per share, the Wall Street Journal said.
Novartis said in a press release that it “does not consider the financial investment in Roche as part of its core business and therefore not a strategic asset.”
Novartis’s stake represents about a third of Roche’s voting rights, but only around 6% of all shares. Novartis has been a shareholder of Roche since May, 2001 and currently holds 53.3 million bearer shares of Roche’s common stock, representing approximately 33% of aggregate outstanding bearer shares.
Novartis expects to net approximately $14 billion from the sale, and over the years has enjoyed a steady stream of dividend payments adding up to around $6 billion.
The transaction is subject to the approval by the shareholders of Roche, at a shareholder meeting on November 26.