A bid too far

5 June 2003

The financial logic of S&N matching the bid for Centerpulse is debatable. But on balance it looks too risky. Walking away would be a strategic blow for the UK orthopaedics group. But not a fatal one.

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Zimmer, the US orthopaedics group conducting due diligence at Swiss rival Centerpulse, is expected to make its offer for the company unconditional on June 17.

Meanwhile, its UK rival Smith & Nephew is considering whether to raise its earlier, recommended bid for Centerpulse, according to people familiar with its thinking.

Zimmer's informal offer of 230 of its own shares and SFr120 in cash for each Centerpulse share is currently worth Sfr324. Centerpulse shares are trading at SFr344.50.

S&N's offer of 25.15 of its own shares and SFr73.42 in cash for each Centerpulse share is currently worth Sfr271.

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