Genzyme rejected Sanofi’s $69-per-share approach for the second time yesterday. Boss Henri Termeer said the board was “not prepared to engage in negotiations… based upon an opportunistic proposal with an unrealistic starting price that dramatically undervalues the company”.
Sanofi chief executive Chris Viehbacher described Genzyme’s response as “relatively unsurprising”. He said Sanofi would prefer to deal with Genzyme’s top brass but hinted the drugs maker was ready to take a hostile offer to the Massachusetts-based outfit’s shareholders, adding: “We are prepared to consider all alternatives to complete this transaction.”
Sanofi hopes to leverage investor dissatisfaction surrounding manufacturing problems at Genzyme, which makes medicines to counter rare conditions such as Gaucher and Fabry disease. Termeer has been weakened in recent months by calls for his removal from investors including Carl Icahn, the activist fund manager.
Analysts suggested Sanofi would have to put $70 per share on the table to enter discussions. The final deal price would be around $75 per share, or $20bn. Shares in Genzyme closed 3.39 per cent up at $69.91.