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Rorer Boosts Trust Offer in Bid for Robins : Bigger Fund for Dalkon Shield Claimants Lifts Offer to $2.92 Billion

December 29, 1987|Associated Press

RICHMOND, Va. — Rorer Group, one of three suitors seeking to acquire A. H. Robins Co., sweetened its bid Monday for the financially troubled pharmaceutical firm to include a $2.28-billion trust fund for Dalkon Shield claimants.

The trust fund, plus an insurance contribution of $200 million and a stock swap valued at about $440 million, would bring the total value of Rorer's bid to about $2.92 billion.

Robins shares closed unchanged at $20.50 Monday on the New York Stock Exchange, while Rorer fell 50 cents a share to $36.25.

Robins has until next week to provide a federal judge with a plan to reorganize its operations. The pharmaceutical giant sought protection from its creditors under Chapter 11 of the federal Bankruptcy Code in August, 1985, in the face of injury claims from users of its Dalkon Shield intrauterine birth-control device.

Rorer's new offer would contribute $2.28 billion to trust funds set up to answer those injury claims.

Rorer on July 3 proposed to buy Robins for about $2.63 billion, which included $1.75 billion to cover potential claims. But that was before U.S. District Judge Robert R. Merhige Jr. set a value of $2.475 billion on the potential value of the more than 200,000 pending lawsuits.

Rorer said Aetna Casualty & Surety would provide $200 million in excess insurance coverage so that the claims value set by Merhige would be met.

Robins has until Jan. 6 to file its amended plan of reorganization with Merhige, who extended Monday's deadline to give the company time to evaluate an offer from New York-based American Home Products Corp.

American Home proposed to exchange $550 million of its common shares for Robins stock.

In addition, Robins has been considering a merger offer from the French pharmaceutical firm Sanofi. American Home and Sanofi both have said that they would fund the $2.47-billion trust. American Home said its payout period would not exceed seven years. Sanofi has not disclosed its proposed payout schedule.

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