CD&R confirms higher £2.7bn offer for UDG Healthcare

US private equity firm Clayton, Dubilier & Rice on Tuesday confirmed its increased final £2.7bn offer for Dublin-based UDG Healthcare.

CD&R, which is also seeking to take over the UK supermarket chain Morrisons, lifted its bid to £10.80 a share, UDG said in a statement to the stock market, adding that the board had agreed to its terms.

The initial offer of £10.23, made in May, was opposed by major shareholders, Allianz Global Investors and M&G who said it undervalued the company

Rory Alexander, a fund manager at M&G, last week said while the group was “pleased” that CD&R had upped its bid, “a potential offer of £10.80 would still fall short of our expectations on behalf of our customers”, the Financial Times reported last Friday.

UDG on Tuesday said M&G and Kabouter Management, who hold 11.41% of the company between them, supported the improved bid.

A vote on the deal will take place next month at the company’s head office in Dublin unless an outside bid is received, in which case CD&R may increase its offer.

UDG operates two divisions and employs around 9,000 workers across 29 countries. Its largest division, Ashfield, is a global healthcare services business working in advisory, marketing and communications, while the other unit Sharp, is a contract packaging, clinical, manufacturing and technology services business.