NeighborCare's board unanimously rejects Omnicare's takeover bid
NeighborCare's board unanimously rejected another hostile $1.5 billion takeover bid from rival Omnicare, Inc, citing the deal as "blatantly opportunistic" and not in the best interest of shareholders. Baltimore-based NeighborCare compared Monday's offer to a previous proposal by Omnicare that the board rejected in April.
Covington, KY-based Omnicare said acquiring NeighborCare would increase the number of beds it serves by about 24%. Omnicare also said the combined company could have revenues of more than $5 billion, significantly more than the company's 2003 revenues of $3.5 billion.
The two companies have an obvious rivalry: in 2002 they fought over rights to acquire another institutional pharmacy provider, NCS Healthcare, based in Beachwood, OH. Omnicare bought NCS after suing to block a purchase agreement between the company and NeighborCare.
NeighborCare, which provides institutional pharmacy services in 32 states and the District of Columbia, reported adjusted net earnings of $37.2 million in 2003. OmniCare, the nation's largest institutional pharmacy, with operations in 47 states and the District of Columbia, earned more than five times Neighborcare's earnings, $194 million, last year.