UPDATE 2-Novartis inches towards closure of Alcon deal

ZUG, Switzerland, Aug 16 (Reuters) - Swiss drugmaker Novartis AG moved another step closer to securing its buyout of Alcon after shareholders of the U.S. eye care group elected Novartis-nominated directors to the Alcon board.

In addition, the U.S. Federal Trade Commission on Monday approved the deal after requiring that Novartis sell to Bausch & Lomb an injectable eye care drug used in cataract surgery.

Novartis is seeking to buy the remaining 23 percent of Alcon after exercising an option earlier this year to buy Nestle's majority stake, which will bring its holding in Alcon to 77 percent.

The election of the Novartis candidates means the drugmaker will have a majority on the Alcon board, facilitating its buyout of minority shareholders in the face of strong resistance from Alcon's independent director committee (IDC).

The IDC has repeatedly spurned Novartis' offer for the minority stake as 'grossly inadequate' and is pressuring Novartis to raise its offer.

Novartis has offered Alcon minority shareholders a stock swap currently worth around $141 per Alcon share, below the average price of $168 per Alcon share paid to Nestle and Alcon's share price of $156.

'We are not happy to talk about that,' Thomas Plaskett, chairman of the IDC, said when asked what he would consider a fair price, declining also to comment on whether the IDC was currently in talks with Novartis.

The IDC has taken a number of steps to fight for a better deal for the minority shareholders, including recently setting up a $50 million litigation trust.

'We hope we can arrive at a negotiated agreement, but if not we have the trust in place and we can use it if we have to,' Plaskett said Reuters after the Alcon extraordinary general meeting on Monday.

Novartis has said its offer is fair and expects to be able to push through its purchase of the remaining stake under Swiss merger law, which requires the backing from of a simple board majority and approval of two-thirds of shareholders for the deal to go ahead.

The election of the five directors becomes effective once Novartis has completed its purchase of the 52 percent stake from Nestle.

The U.S. FTC said that because Novartis and Alcon are the only two U.S. providers of a class of drugs known as injectable miotics, it would require Novartis to sell the rights and assets related to eye drug Miochol-E within 10 days of the acquisition's completion.

(Reporting by Katie Reid, additional reporting by Deena Beasley in Los Angeles; Editing by Louise Heavens and Steve Orlofsky) Keywords: NOVARTIS/ (Zurich newsroom +41.58.306.7336; fax [phone]; [e-mail]) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.