Sanofi pushes €8.1bn takeover offer
Medivation’s top shareholders have signalled “overwhelming support” for a transaction, Paris-based Sanofi said in a letter yesterday. Medivation last week rejected the bid, saying it substantially undervalues the US drugmaker.
“You should know that an acquisition of Medivation is a priority for Sanofi and we are committed to effecting it,” Sanofi chief executive Olivier Brandicourt said in the letter to Medivation.
Sanofi’s proposal, at $52.50 a share, would deny stockholders the value of future products, Medivation said in a statement last Friday.
The San Francisco-based company has one marketed medicine for prostate cancer, Xtandi, and is developing other oncology treatments.
Medivation’s shares had closed yesterday at $56.17, some 7% above Sanofi’s $52.50 offer price, underscoring broad belief that a counterbidder may swoop in.
The stock advanced up to 2.2% yesterday, hitting a 10-month high of $57.41. That’s well above the $50.06 that 17 Wall Street analysts, on average, believe the company will be worth in a year , suggesting shareholders could be getting a little ahead of themselves.
Sanofi has described the deal as value-creating for Medivation shareholders, with whom it plans to engage directly. However, many are unlikely to listen unless they hear the shuffling of dollar bills, as a higher bid appears within reach and the French company isn’t the only game in town.
The likes of Bayer, Merck, Novartis and Astellas would all benefit from thwarting Sanofi’s ambitions with bids of its own, according to Bloomberg Intelligence analyst Sam Fazeli.
And AstraZeneca and Pfizer are among firms that may consider offers.
Last week, Barclays analysts’ estimated a takeout price needs to be $15 to $20 higher than Sanofi’s tabled $52.50 offer.
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