Novartis Chair Denies Rumors of Merger With Roche
Speculation surrounding a merger between Novartis AG (NYSE:NVS) and Roche Holding Ltd. is unwarranted, said Novartis chair Joerg Reinhardt, according to a Reuters report Sunday. Reinhardt said that although its true the two companies will be working more closely, there are no plans for a merger.
“Two pharma groups working in the same location have many topics in common,” Reinhardt said. Both Novartis and Roche are based in north-western Switzerland, in Basel. Reinhardt’s response echoes earlier statements from the chair this past year; in August, he was asked whether the two companies wanted to remain independent: Reinhardt replied with a resounding “absolutely.”
Reinhardt has been exchanging e-mails with Roche’s new chair Christoph Franz, who was nominated for the position at the end of March last year. The Novartis chair also added that he had recently met Franz’s predecessor, Franz Humer, a few weeks ago, according to Reuters.
Novartis’ Chief Executive Severin Schwann has also previously denied speculation of a merger between Novartis and Roche. In October, Bloomberg and similar news outlets reported that the Chief Executive held a conference call with reporters in which he stated, “Nothing has changed with regards to Roche’s position towards Novartis. The families Hoffman and Oeri have repeatedly stated they’re committed to Roche’s independence.”
Chair Reinhardt was also asked whether Novartis had any plans to sell its sizable stake in Roche (the company currently holds a third of Roche’s bearer shares), which the company built up under Reinhardt’s predecessor, Daniel Vasella. Reinhardt responded by saying that, “The shares are in good hands with us. For as long as Roche does well, we take pleasure in them,” Reuters reports.
Novartis is currently engaged in an ongoing, year-long review of its over-the-counter, animal health and vaccines businesses. The company is attempting to re-focus, a common trend in pharma recently. At the end of the year, Reinhardt stated, “we will know if and how we have to change our structure and organization.” He also mentioned that at that point, discussions with partners as to divestments and mergers would be a possibility.
“There are not many players, and everybody talks to everybody,” he added, per Reuters.