‘Perfect sense’: CSL looks to future with mammoth diversification play

CSL will be funding the deal through a combination of existing cash, existing and new debt and share placements to both institutional and retail investors.

The share placement program for institutional investors will raise $US4.5 billion ($6.3 billion), via a bookbuild process with shares starting at $273.

A $750 million retail share purchase plan will follow.

Vifor shares have rocketed on speculation that the deal was close, gaining 18.5 per cent on Monday to close at 140.3 Swiss francs.

CSL shares have wobbled throughout the start of December, however, as investors speculated on how the company was going to cover the $17 billion price tag, and what form any share offer would take. The stock has had a bumpy 12 months as investors have grappled with the impact of the pandemic on plasma collections.

Vifor, which already has a strong foothold in Australia, would unlock new research and development opportunities for CSL, in very different areas to its current focus.

Vifor’s focus on new treatments for chronic kidney disease could see significant patient demand if approved, with the US Center for Disease Control (CDC) estimating that one in five Americans will experience the disease in their lifetimes.

While CSL has been in the headlines over the past two years for its role in making the AstraZeneca COVID vaccine, the company has consistently said its core focus remains on its existing specialty medicine portfolios and developing new products.

The company invested more than $US1 billion in research in 2020-21, and is expecting a number of long-term projects to come to fruition in the next few years. This includes late-stage trial data for its heart attack drug CSL112, which analysts hope will deliver long-term gains for the company.

The business also confirmed on Tuesday that it will still consider local manufacturing of messenger-RNA (mRNA) vaccines and products in Australia, even as US biotech giant Moderna plans to set up shop in Victoria.

“The company will continue to consider options for an industrial-scale mRNA vaccine manufacturing facility and determine where it is most compatible within our global network,” said chair Dr Brian McNamee.

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