Novartis to Sell Roche Stake for $20.7 Billion
Novartis said Thursday that it agreed to sell its stake in Roche for $20.7 billion, with the proceeds to be used "in line with capital allocation priorities to enhance strong returns to shareholders," according to a FirstWord report. Novartis built up the stake between 2001 and 2003, and currently holds 53.3 million bearer shares of Roche's stock, representing approximately 33% of aggregate outstanding bearer shares.
"After more than 20 years as a shareholder of Roche, we concluded that now is the right time to monetise our investment," remarked Novartis CEO Vas Narasimhan. The drugmaker acquired the stake for around $5 billion, noting that it has delivered recurring earnings contribution and cumulative dividends of over $6 billion over the holding period. Novartis will record a gain from the sales of the stake of approximately $14 billion.