GE set to launch Amersham bid

AMERICAN goliath GE is on Friday set to reveal its bid for medical equipment group Amersham.

The offer, which raises the prospect of a break-up of one of the UK's flagship healthcare firms, is likely to top £4.6bn, making it the biggest takeover this year.

Amersham's market value soared on Wednesday after it disclosed an approach.

On Thursday, the shares hit 686p before closing up 19p at 660p. Some think the takeover price could be as high as 750p a share, valuing the group at £5.3bn.

Connecticut-based GE, the world's most valuable company, is thought to be most interested in Amersham's medical imaging division, which makes 38% of all the compounds used to distinguish tissues during body scans.

GE's £5.4bn medical systems side is a leading manufacturer of scanning equipment and would seek to boost profits by sharing research and development spending and by marketing the machinery and the compounds jointly. This could attract the attention of competition authorities.

GE would be likely to dispose of Amersham's remaining two divisions. Some believe the separations side, equipment for ingredients used in vaccines, could be floated for £1.6bn. The drug research and manufacturing arm could fetch £400m.

Chief executive Sir William Castell will pocket at least £1.1m if he manages to sell Amersham, the first company to be privatised by the Thatcher government.