Replies to post #61185 on Biotech Values

[Preciouslife1]

A proposition is said to be tautological if its constituent terms repeat themselves or if they can be reduced to terms that do, so that the proposition is of the form "a = a" ("a is identical to a").

I would assume it is in two parts so that the "Smores"
tests can be run to see if the Nestle's chocolate is
the "very best chocolate".....you have to be semi "old"
to understand that lil jingle reference me thinks.....
The $39 Billion offered for 77% of Alcon is staggering
for it's content and return capabilities for the
acquirer imho. $39 Billion creates one "sweet" war chest
to go on an acquisition binge in the food industry if that
is Nestle's plan down the road.....either way, it is a
sugary deal for the Nestle's crew.....

[DewDiligence]

Re: NVS-Alcon quiz

Tax avoidance was not cited as part of the rationale for the two-step deal structure, and Swiss-based companies may not be able to exploit such a scheme, as you said.

The motivation for the two-step structure is simply that Nestlé does not want the full $39B right away because they don’t think they’d be able to deploy that much money all at once. With the actual deal structure, Nestlé continues to benefit from Alcon’s earnings on a pro rata basis during 20008, 2009, 2010, and perhaps some of 2011. (By retaining 52% of Alcon after the first step of the deal, Nestlé will also be able to consolidate 100% of Alcon’s sales on its own P&L.)

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This leaves unanswered the second question of the quiz:

Why didn’t NVS furnish any estimates of cost synergies to accrue from the Alcon acquisition?

Hint: the answer is very simple!