Next inversion? Hospira reportedly bidding for Danone unit

|About: Danone ADR (DANOY)|By:, SA News Editor

Hospira (NYSE:HSP) has emerged as a bidder for Danone's (OTCQX:DANOY) medical-nutrition unit in what could be about a $5B deal, reports the FT. A purchase could allow the Illinois-based Hospira to move its domicile abroad for tax purposes.

Hospira's 25% rally YTD is a boon since to qualify for an inversion owners of the acquired company must receive at least 20% of the merged company's stock, meaning Hospira - currently valued at $8.6B - would have to fund a sizable portion of the deal with its shares.

Previously, European consumer outfits like Nestle and Fresenius had been reported as prospective bidders for the Danone business, but it's unclear if either continues to have interest.

Previously: Report: Danone looking to sell medical nutrition business to Nestle