PARIS: Sanofi said it could raise its proposed $9.3 billion deal to buy Medivation if the US cancer drugmaker engaged in talks, threatening to go directly to shareholders to oust the board if not.
Sanofi Chief Executive Olivier Brandicourt wrote in a letter to the board of Medivation published on Thursday that the transaction was a priority for the French drugmaker and it was committed to seeing it through.
The CEO added Sanofi had spoken to top shareholders in the target company and the proposal had “overwhelming” support.
“If you engage in good faith discussions with us and demonstrate additional value, we could be in a position to revise our offer,” the CEO wrote.
“If you are not prepared to engage with us, we have no choice but to go directly to your shareholders.”
Sanofi said rules in the state of Delaware, where Medivation is registered, gave shareholders owning a majority of the company the power to oust the board.
“If the Medivation board of directors continues to refuse to engage with us, then we intend to commence a process to remove and replace members of the board,” Brandicourt said.
Sanofi went public with the takeover proposal on April 28, but Medivation rejected the $52.50-a-share deal outright, saying it undervalued the company “substantially”.
The stock has since risen to over $59. “We believe we have offered a fair price, and a very attractive premium,” Brandicourt wrote in the letter. “We remain enthusiastic about a potential combination with Medivation.” Sanofi is keen to boost its presence in cancer treatments and teamed up last year with U.S firm Regeneron in immuno-oncology. This differs from traditional treatments such as chemotherapy or radiotherapy as it uses or enhances the patient’s own immune system to stop the growth of cancer cells.
Based in San Francisco, Medivation is known for its Xtandi prostate cancer treatment.
U.S firm Pfizer has also approached Medivation to express interest in an acquisition, raising the possibility of a bid rivalling Sanofi’s, people familiar with the matter said on Tuesday.
Copyright Reuters, 2016
Courtesy : BRecorder