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UPDATE 1-Celesio shareholder on mission to salvage takeover -sources

Matthias Inverardi and Ludwig Burger
Thursday, 23 Jan 2014 | 7:30 AM ET

* Haniel in talks over Elliott's stake -sources

* Price under discussion is 23.50 euros per share -sources

* U.S. suitor McKesson sought 75 percent acceptance

(Adds detail, offer price, background)

FRANKFURT, Jan 23 (Reuters) - The majority shareholder behind German drugs distributor Celesio is in talks to hammer out a deal that could salvage its on-off takeover by U.S. peer McKesson, three people familiar with the negotiations said.

Family-owned conglomerate Franz Haniel & Cie, keen to cash in on its stake in the owner of the Lloyds pharmacy brand, is negotiating with hedge fund Elliott Management Corp as it seeks a commitment to sell from enough shareholders to broker a failproof deal with Celesio's U.S. suitor, the sources said.

Haniel's previous attempt crumbled this month, when McKesson failed to reach the 75 percent shareholder acceptance it had set as a condition for a Celesio takeover, even after agreeing to Elliott's demands for a sweetened bid.

The sources said that the price being discussed is 23.50 euros per share, the same as last month's bid, but it is unclear how much is being offered for Elliott's Celesio bonds, which convert to shares in the drug distribution company.

It remains uncertain whether Haniel is offering to buy Elliott's stake directly or is acting as an intermediary on behalf of McKesson.

Haniel, Elliott and Celesio all declined to comment. A McKesson spokesman was not immediately available to comment.

As part of McKesson's initial bid, worth about 6.2 billion euros ($8.4 billion) including debt, the U.S. company's acceptance threshold also took into account shares from Celesio's convertible bonds.

Regulatory filings have shown that at Jan. 13 Elliott held shares and convertibles equivalent to 26.7 percent of Celesio's fully diluted equity capital. On the same basis, Haniel held a 41.8 percent stake.

That meant that their combined holding at the time was 6.5 percent short of McKesson's 75 percent hurdle. When shares alone are taken into account, Elliot held 24.08 percent and Haniel 50.01 percent.

McKesson wants to acquire Celesio to further its push to become a global leader in drugs distribution, boosting its bargaining power with big pharmaceutical companies such as Novartis and Teva.

Haniel, meanwhile, has been shedding assets to offset a massive 2012 writedown on its holding in German retailer Metro and reduce a debt burden that stood at 1.6 billion euros ($2.17 billion) at Sept. 31. ($1 = 0.7372 euros)

(Additional reporting by Frank Siebelt; Editing by David Goodman)

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