U.S. drugs wholesaler group McKesson said it had failed to win enough support for a $8.4 billion offer to buy German distributor Celesio, leaving it empty-handed in a sector where cross-border consolidation is accelerating. The suitor last week raised its offer for Celesio to 23.50 euros per share from 23 euros following pressure from activist hedge fund investor Elliott, which had become Celesio's second-largest shareholder behind Franz Haniel & Cie GmbH. But McKesson said it had still failed to get across the 75 percent threshold for acceptances which it had set as a condition for going ahead with the higher offer. "While we are disappointed that we were not successful in completing our offers for Celesio, we have a track record of great performance, a strong balance sheet and demonstrated leadership and scale across our markets," McKesson's chairman and chief executive, John Hammergren, said in a statement. "We are well positioned and will continue to explore and evaluate opportunities to further strengthen our businesses through our disciplined approach to capital allocation." The setback leaves McKesson without a partner while elsewhere in the industry, cross-border tie-ups are picking up speed. McKesson-Celesio would have eclipsed another transatlantic tie-up in drugs trading, the purchase of a 45 percent stake in European pharmacy chain Alliance Boots by U.S. peer Walgreen Co in 2012. Alliance and Walgreen have close to $110 billion in annual revenue between them but are looking to bulk up further as they build a stake in distributor AmerisourceBergen. Pharmacy chain CVS Caremark and drugs distributor Cardinal Health last month struck a 10-year agreement to form the largest generic drug sourcing operation in the United States. Some analysts think the McKesson should give it another try. "With material accretion assumed in Street models coupled with all of the work McKesson has committed to this deal, we would have to think the company makes one more attempt for Celesio," said Greg Bolan, an analyst at Sterne Agee. Franz Haniel & Cie GmbH, which holds a 50.01 percent stake in Celesio and had accepted the original offer, said it regretted that the bid was not successful. "We can now take our time at Haniel to calmly analyse the situation and consider all options," Chief Executive Stephan Gemkow said in a statement. No one at Elliott was immediately available to comment. Left on its own, Celesio said it would resume a strategy it had drawn up before the takeover offer. In response to a tough business environment, Celesio Chief Executive Marion Helmes had been centralising procurement to cut costs, as well as widening and standardising the offering of its pharmacies across Europe under the Lloyds brand. "Our strategy to widen our network of pharmacies and our central procurement and to optimise the supply chain is successful and will be pursued further as before," Helmes said on Monday. Celesio has been in a price war that has all but erased profit from a crowded German drugs wholesale market. Healthcare cuts across Europe, its main market, have added to woes. But even before the bid Helmes had conceded that an alliance or tie-up with a U.S. partner could help win steeper discounts, mainly for the generic drugs it buys but also for non-prescription medication and skincare products. (Reuters)