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Biotech / Medical : VVUS: VIVUS INC. (NASDAQ) -- Ignore unavailable to you. Want to Upgrade?

To: VLAD who wrote (9302)	6/7/1998 4:11:00 PM
From: VLAD	Read Replies (1) \| Respond to of 23519

[ Business \| US Market \| Industry \| IPO \| S&P \| International \| PRNews \| BizWire \| Finance Home ] -------------------------------------------------------------------------------- Sunday June 7, 8:48 am Eastern Time Sweden's revamped Investor moves on Astra By Belinda Goldsmith STOCKHOLM, June 7 (Reuters) - Sweden's industrial dynasty, the Wallenbergs, has in recent days appeared to solve its two key problems in reshaping its weighty portfolio with new futures plotted for forestry group Stora and drugs major Astra. Last Tuesday Stora (STORa.ST) announced a merger with Finnish rival Enso (EOYRV.HE). On Friday Astra (ASTRa.ST) said it was in talks with Merck and Co Inc (MRK - news), possibly on a buy-out of a joint marketing venture in the United States which has been seen as an obstacle to Astra's expansion. The Wallenberg family's holding vehicle, Investor AB (INVEb.ST), is the largest single shareholder in both groups. ''In four days the Wallenberg business empire has solved two of its biggest problems,'' Swedish business newspaper Dagens Industri said in a weekend edition. The moves come amid a shake-up at Investor which began last year when the family brought in respected Swedish industrialist Percy Barnevik to chair the group and replace retiring patriarch Peter Wallenberg. Investor, referred to as Sweden Inc in some quarters, controls about a third of the Stockholm bourse through voting rights in some of Sweden's largest companies such as engineer ABB (ABBa.ST) (ABBZ.S), Saab Auto, Electrolux (ELUXb.ST), and bearings maker SKF (SKFb.ST). Barnevik has made it clear he will weed out poor performers from the group's portfolio, targeting companies whose growth does not exceed the stock market average. Late last year the Wallenberg controlled bank S-E-Banken (SEBa.ST) merged with Swedish insurer Trygg-Hansa at the tail-end of a consolidation phase in Sweden's financial sector. Stora was seen as ripe for change, having slipped in the 1990s from Europe's largest paper company to third place. Through its merger with Enso, it will be part of the world's largest paper group with annual capacity of 13 million tonnes. Analysts expected Investor to move on Astra and free up the drugs group from a 1982 licensing deal with Merck in the United States which led into a marketing joint venture, Astra Merck Inc, in 1994. A deal is expected to emerge next week. The company has said there is no assurance of a deal and declined to go into details of the negotiations. ''But this has been Hakan Mogren's goal since he became chief executive at Astra,'' an analyst told Dagens Industri. ''The big advantage of a wholly owned Astra Merck Inc is that they can sell all new products themselves in the U.S.. This is a must if Astra is going to take part in a merger and I know that is what Mogren wants.'' Astra Merck Inc, which divides sales income from the crucial U.S. market evenly between Astra and Merck, has been viewed as a hurdle for Astra to take part in the current restructuring in the global pharmaceuticals industry. ''No other company wants to be weighed down in a merger with a company where half the profits go to another company,'' a London-based analyst said. But sector commentators said the deal was far from clear -- as was the price, which would come from Astra's cash pile. ''The question is what it is going to cost Astra,'' said an editorial in Dagens Industri, referring to a media speculated figure of 10 billion dollars. ''It must be borne in mind that the current main product, stomach ulcer drug Losec (which accounts for about half of Astra's sales), will start to see its patents expire soon and therefore effect sales.'' Commentator Elisabeth Sandlund of daily paper Svenska Dagbladet also viewed the flagged price as expensive. ''The price is incredibly high if you think Losec income will probably fall dramatically in coming years,'' she said. With an Astra deal close to being in the bag, analysts were expecting Investor to act next on its holding in the world's largest bearings maker, SKF (SKFb.ST), which is not meeting Barnevik's growth criteria. Market rumours suggest Investor is in talks with the company's second largest shareholder, construction group Skanska (SKAb.ST) over SKF. Skanska has already openly declared that its SKF stake is up for sale. -------------------------------------------------------------------------------- More Quotes and News: Merck & Co Inc (NYSE:MRK - news) Related News Categories: US Market News, health, international -------------------------------------------------------------------------------- Help -------------------------------------------------------------------------------- Copyright c 1998 Reuters Limited. All rights reserved. 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