France’s Sanofi-Aventis is not giving up, launching a hostile takeover bid today worth $18.5 billion for US biotech company Genzyme. Genzyme has twice rejected the Sanofi-Aventis offer of purchase, and now faces a battle to keep the company.
At $69 a share, the Sanofi-Aventis hostile bid is the same prices that Genyzme rejected in a private and public ‘friendly’ bid by Sanofi-Aventis earlier in the year.
Genzyme has asked shareholders not to take action. In a press release, the company has said that the board will review the third offer in conjunction with independent consultants and let the shareholders know within 10 working days of their decision.
Sanofi-Aventis Chief Executive, Chris Viehbacher told reporters during conference calls that the company chose to go straight to the shareholders this time because in previous attempts the Genzyme board had "refused to engage in constructive discussions," despite the earlier attempts by Sanofi.
Viehbacher further commented that the Genzyme acquisition by Sanofi would "unlock value for both sets of shareholders, so I think it would be a real shame to walk away.” The Genzyme management wants more money for the purchase, but Viehbacher has said categorically that they are not prepared to offer more, especially given that there is no other bidder on the scene.
The Sanofi offer to shareholders is valid until December 10. For Sanofi, Genyzme offers a new platform for expanding its biotech business, increasing its US presence as well as growing and expanding its lucrative market share in drugs for rare diseases.
