Overview
Gerresheimer, the German manufacturer of medical packaging, has rejected a takeover approach from U.S. rival Silgan, according to three people familiar with the matter. The parties are no longer engaged in discussions, the sources said.
Market response
Following the report, Gerresheimer's stock initially dropped by more than 5% before staging a recovery. By 09:28 GMT in European trading the shares were trading roughly 1.7% higher than immediately prior to the report.
Company priorities
Gerresheimer is said to be focused on resolving ongoing accounting issues and on finalizing the sale of its U.S. subsidiary Centor. Company management intends to address those matters before considering any potential transaction, according to the sources.
Previous offer details
In March reports indicated Silgan had been working on a non-binding proposal valuing Gerresheimer at EUR 41 per share. That figure previously was described as more than double the company's share price at the time the proposal was being considered.
Share performance and financial pressure
Gerresheimer has endured a difficult spell in the markets. Its shares have fallen more than 80% from a 2023 peak and are down about 22% year-to-date, leaving the firm with an approximate market capitalization of EUR 742 million. Earlier this year the company disclosed that Germany's financial regulator, BaFin, had widened a probe into its financial statements, exacerbating pressure on the firm's share price and accounts.
Past negotiations
This is not the first time potential transactions have failed to progress. Last year Gerresheimer engaged in talks with private equity parties about a possible sale, but those discussions concluded without an agreement.
Note: The report that Gerresheimer rejected a takeover approach and is prioritizing its accounting remediation and the Centor sale is based on information from three people familiar with the matter. Market moves and prior reported offer levels reflect the details provided by those sources.