Mayne Pharma shares plunge as Chalmers blocks $672m US takeover deal
Treasurer Jim Chalmers will block a $672m US takeover of Adelaide company Mayne Pharma amid uncertainty over the future of its manufacturing facility at Salisbury South.
A $672m takeover of Adelaide pharmaceuticals company Mayne Pharma has been rejected by Treasurer Jim Chalmers amid uncertainty over the future of the company’s Salisbury South manufacturing facility.
The decision follows a months-long legal battle between Mayne Pharma and US suitor Cosette, which had been attempting to pull out of the deal over claims there had been a “material adverse change” in Mayne Pharma’s financial performance after it lodged its offer in February.
While the Supreme Court of NSW rejected Cosette’s argument for terminating the agreement earlier this month, the deal appears doomed, with the Foreign Investment Review Board deciding to oppose the deal.
Treasurer Jim Chalmers said the US company’s intention to close the Salisbury South site would act against the state and national interests.
“The workers of South Australia are our focus,” he said.
“We’ll always go into bat for Australian workers and that’s what we’ve done.
“Safeguarding Australian jobs is a central feature of the government’s economic agenda and it was a central consideration in this case.”
The South Australian government had been lobbying the FIRB to reject the deal due to the potential closure of the Salisbury South facility, which it says would cost 200 full-time jobs, plus another 140 indirectly, and cut gross state product by $77.9m.
But Mayne Pharma slammed the Treasurer’s decision on Friday, pointing to the fact Cosette had only threatened to dispose of or close the Salisbury site in June, weeks after it made its first attempt at terminating the deal on financial performance grounds.
The Adelaide company has previously rejected claims that it was considering shutting the manufacturing facility, and says it has been locked out of talks with the FIRB over the future of the site.
“Given the valuable nature of the site, Mayne Pharma does not consider that it would be commercially rational to close the site and has consistently communicated this to Cosette since Cosette informed FIRB of its stated change of intention on 24 June 2025,” Mayne Pharma said in a statement to the ASX on Friday.
“Mayne Pharma has sought Cosette’s consent to engage directly with FIRB in relation to communications made by Cosette to FIRB after Cosette purported to invalidly terminate the scheme (scheme of arrangement), such consent has not been provided.
“Mayne Pharma has not been permitted to, and has not had, any direct communications with FIRB, the Treasurer or any other governmental agency in respect of the FIRB approval or the Salisbury site.”
Mayne Pharma chief executive Shawn O’Brien said the Salisbury South facility had been “a key pillar of our success”, and it had recently undergone an $18m upgrade with the support of a $4.8m Modern Manufacturing grant from the federal government.
“For decades, it has been, and remains, a TGA and FDA-approved pharmaceutical production site, recently strengthened by our recent $18m investment at the facility,” he said.
“The site’s world-class capabilities position Mayne Pharma as a trusted partner to leading pharmaceutical companies, underpinning our ability to deliver innovation, quality, and reliability on a global scale.”
Mayne Pharma shares plunged 31 per cent on Friday, trading at $4.28.
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Originally published as Mayne Pharma shares plunge as Chalmers blocks $672m US takeover deal
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