Glaxo Wellcome and SmithKline Beecham announced on Tuesday, December 12, that they were close to reaching agreement with US regulators on their merger to form the world's largest pharmaceutical group.
The two firms, in a statement issued here, said they had worked out an accord with the US Federal Trade Commission (FTC) staff on the tie-up.
But they warned that the agreement would now have to be submitted to the Commissioners of the FTC for review and approval.
"No assurance can be given that the terms agreed with the FTC staff will be agreed by the Comissioners," they said.
A decision from the US regulators is expected before December 20, a spokesman for SmithKline Beecham told AFP.
In September, the FTC had demanded supplementary information from the two groups about products that help people to quit smoking before it would act on their proposed merger.
It had been the second time in as many months that the two companies have been forced to delay their merger, after putting back the deadline in July.
In order to satisfy the US authorities, SmithKline Beecham agreed to sell its anti-herpes drugs Famir and Vectavir/Denavir for $1.63 billion (1.88 billion euros) to Novartis of Switzerland in August.
At the same time it sold its anti-vomiting drug Kytril to Roche of Switzerland for $1.23 billion.
No further sales are expected to be required, the company said.
The two drug giants must now also obtain final agreement for the merger from British authorities in a decision expected on December 20, the statement said.
But the SmithKline Beecham spokesman said that this process, to be sought at the British High Court, was merely a formality in order to transform the two companies' stock into a single stock.
Once final clearance in both countries is obtained, Glaxo Wellcome and SmithKline Beecham hope to list shares in the merged company in London on December 27.
The European Commission gave regulatory clearance for the merger in May, and shareholders approved the combination in July.
The drugs giants unveiled their merger in January and said it would create the world's biggest pharmaceuticals group with some 7.3 percent of the global market.
A previous attempt to merge in 1998 broke up acrimoniously amid a dispute over who should lead the group.— (AFP)
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)