Pharmacia is to spin off MTC as the biotech ag unit, and the following press release is discussing the offering by Goldman on this.
Peter and others, do you want to take a stab of this new company in terms of how it could and should be valued by the market? I think it will be a dynamite company in the future, perhaps a MLNM of the ag biotech world, WITH SALES AND PROFITS NOW!
By Steve Gelsi, CBS.MarketWatch.com
Last Update: 8:59 AM ET Aug 31, 2000 NewsWatch
Latest headlines
Pharmacia holding on to Monsanto
Drug giant treads carefully with IPO terms
MEW YORK (CBS.MW) - Pharmacia plan to sell a less than expected stake of its Monsanto agricultural chemical business to the public as the drug giant treads carefully in the downbeaten sector, a Wall Street analyst said Thursday.
Pharmacia (PHA: news, msgs) said it'll sell about 15 percent of Monsanto (MON: news, msgs) under terms of the initial public offering, including the over-allotment shares appropriated to underwriters.
That's less than the maximum 20 percent figure that the company had been discussing.
"They didn't want to sell all of it at these valuations," said Ian Sanderson of SG Cowen. "They're probably planning to hold onto a bit more of it and build the value from there."
Monsanto filed its IPO on May 12. After filing their IPOs, companies and their underwriters typically conduct a preliminary gauge of market interest before setting the terms of the deal, usually months later.
Sanderson said Pharmacia is embarking on the IPO to "put a separate valuation on its agricultural business to focus more on pharmaceuticals."
Monsanto will raise about $788 million in its IPO, based on terms set Wednesday.
The St. Louis-based agriculture chemical company set its price at $20 to $25 per share and put its number of shares at 35 million. The deal's lead underwriter is Goldman Sachs.
The IPO stems from its $30 billion merger last year with Pharmacia & Upjohn.
Terms of the deal stipulated that Monsanto could spin off part of its agricultural business.
Monsanto bills itself as a global provider of technology-based offerings and agricultural products for growers, grain processors and consumers. One of
its leading products is Roundup, a weed killer.
The company rang up $150 million in profit on $5.2 billion in sales last year. |
