German drugs firm Bayer has launched a court case against rival Merck, accusing it of trying to illegally block a takeover bid for Schering.
Bayer wants a court to force US drugmaker Merck to divest a recently acquired stake in Schering.
It also alleges that Merck broke US securities rules by failing to disclose the purchase.
Bayer claims Merck will use the stake to vote against its 16.5bn euro ($20.3bn) takeover bid for Schering.
"As a result of Merck's violations, investors - including Bayer - were unaware that Merck was plotting to derail Bayer's tender offer and thus deprive Schering's shareholders of the opportunity to sell their shares at a significant premium," the lawsuit says.
The case has been filed in the US District Court of Manhattan as approximately 19% of Schering's stock is held in the US, according to the Bayer claim.
Increased stake
Merck has built up a 21.8% holding in German group Schering, buying most of the stake in recent days.
Its latest purchase of 2.1 million shares was disclosed in a filing to the US Securities and Exchange Commission after the lawsuit was launched.
Meanwhile, Bayer has hinted it may raise its 16bn euro offer in order to seal a deal with Schering and end an aggressive tussle with its US rival.
If the Bayer-Schering deal does go through it would create a healthcare group with sales of over 15bn euros.
(BBC)
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