Sanofi-Aventis SA began an $18.5 billion hostile takeover offer for Genzyme Corp after the US biotechnology company spurned Sanofi’s $69-a-share bid as too low and refused to negotiate.
Sanofi, France’s largest drug maker, started a tender offer to acquire all outstanding shares of Genzyme for $69 each, the Paris-based company said in a statement today. The offer expires on 11:59 pm in New York on December 10.
“We believe the offer will be successful,” Sanofi Chief Executive Officer Chris Viehbacher said during a conference call with reporters today. While Sanofi is still open to talks with Genzyme, Viehbacher sees “no particular reason to bid more.” Sanofi is a “patient and disciplined buyer,” Viehbacher said.
Investors who own more than 50 per cent of Genzyme indicated in meetings with Viehbacher that they were willing to sell their shares at “a reasonable price,” the 50-year-old executive said at a conference on September 15. Conversations also “revealed that those shareholders were frustrated with Genzyme’s persistent refusal to have meaningful discussions regarding Sanofi-Aventis’ proposal,” he said.
Genzyme, based in Cambridge, Massachusetts, rejected the original offer as too low and has since “blocked at every turn” all of Sanofi’s efforts to negotiate, Viehbacher said. A meeting between Viehbacher and Genzyme Chief Executive Officer Henri Termeer on September 20 proved “unproductive,” and the two CEOs haven’t spoken since.
‘Silly’
“If they can’t get through Genzyme’s management, they’d be silly not to approach the shareholders directly,” Phil Nadeau, an analyst at Cowen & Co in New York, said in a September 30 interview. Nadeau has an “outperform” rating on Genzyme. Genzyme’s stock sank as much as 43 per cent from its 2008 high.