Alere Sues Abbott to Force Merger -- Update

By Austen Hufford 

Alere Inc. escalated its fight with reluctant buyer Abbott Laboratories by filing a lawsuit against its potential acquirer to push it to move forward with the deal.

Abbott agreed to buy Alere in February for nearly $5 billion. Since then, Alere disclosed it has received a subpoena regarding a foreign corruption investigation over payments in Africa, Asia and Latin America and it said separately that federal investigators are seeking information about government-billing practices. The company was also late in filing its 2015 annual report.

Since agreeing to the deal, Abbott has signaled it might not want to ultimately go through with it. Earlier this month Abbott said the deal might not be completed "on a timely basis, or at all." Alere rejected an offer of up to $50 million to terminate the deal.

On Thursday, Alere said it filed a lawsuit in Delaware's Chancery Court to compel Abbott to "promptly" obtain antitrust approvals for the deal. Alere also said it would "take all actions necessary" to make Abbott complete the deal.

Abbott said the lawsuit was without merit. "Abbott is compliant with its obligations under the merger agreement and continues to work toward regulatory approvals, despite Alere's nearly six-month delay in filing its" annual report, a spokeswoman for Abbott said.

Abbott shares rose 0.2% as Alere shares fell 2.2% in midday trading Friday. Alere shares are now trading at $39.80, well below the deal price of $56, indicating investors may believe the deal won't go through.

Write to Austen Hufford at [e-mail]

(END) Dow Jones Newswires

August 26, 2016 12:56 ET (16:56 GMT)

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