Sanofi unwilling to meet Genzyme demands
PARIS: Sanofi, France's biggest pharmaceutical company, must decide this week whether to extend its hostile tender offer at $69 a share, raise the bid, or walk away if it doesn't win support from enough Genzyme shareholders. Photographer: Antoine Antoniol/Bloomberg
Sanofi-Aventis SA is unwilling to meet demands by Genzyme Corp. to raise its $18.5 billion offer and make a later payment based on sales goals for the drug Campath, said three people with direct knowledge of the matter.
The board of Sanofi, France's biggest pharmaceutical company, would be open to one of the concessions, but not both, said the people, who declined to be identified because the deliberations are confidential. While executives of the companies aren't in talks, their advisers have been in contact, the people said.
Sanofi must decide this week whether to extend its hostile tender offer at $69 a share, raise the bid, or walk away if it doesn't win support from enough Genzyme shareholders. The offer for the Cambridge, Massachusetts-based company expires at midnight on Dec. 10.
"We think Sanofi will extend the offer with no bump" in price, Lionel Melka, co-manager of Bernheim, Dreyfus & Co.'s Diva Synergy Fund, an event-driven fund focused on acquisition targets that owns Genzyme shares, said in a Dec. 2 interview. "They really believe that no white knight will emerge."
Genzyme told shareholders in October to reject the bid, saying the price didn't include potential revenue from Campath and two other new medicines expected to win approval by 2013. Campath is approved for blood cancer, and Genzyme says it also works against multiple sclerosis. The company is in the final stages of testing the drug against MS and expects data from those trials next year. -Bloomberg