Fresenius Set to Pull Out of Bidding for Danone's Medical-Nutrition Business

By Heide Oberhauser-Aslan 

German health-care products and services company Fresenius SE & Co. KGaA is set to withdraw from the bidding for the medical nutrition business of French dairy-products group Danone SA, two people familiar with the matter said.

There is a 98% likelihood the deal won't materialize, said one person close to the matter. Fresenius is highly frustrated with the way the negotiations have taken place, this person said.

A Fresenius spokesman declined comment.

As previously reported, Fresenius and European buyout firm Permira have made a joint bid for the business, according to people familiar with the matter, as the French group pushes to advance a sale that has run into several road bumps.

The bid was submitted earlier in November, the people said. The medical unit could have a value of 3 billion euros ($3.75 billion) to 4.5 billion euros, according to analyst estimates.

Danone has been in talks with potential buyers since March to sell its medical-nutrition business, which makes food for the sick, young and elderly, but efforts to complete a sale have been complicated by disagreements over price and potential antitrust issues.

Write to Heide Oberhauser-Aslan at [e-mail]

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