Aventis makes eyes at Novartis

The Franco-German company issued an official invitation to Novartis in a document setting out the positive reasons for such a link - and issuing a plea to shareholders to "say no to the Sanofi offer."​

The document said that a Novartis/Aventis link-up would create the number two pharma company worldwide - and the number four in the US - with a strong profile in cardiovascular, oncology, vaccines and metabolic diseases.

In contrast, says Aventis, Sanofi is under a significant threat relating to the lawsuit challenging the patents on Plavix (clopidogrel), its leading antithrombotic drug. If a Sanofi/Aventis marriage does occur, the company is planning to put a mechanism in place to safeguard Aventis' shareholder interests should Plavix lose its patent - a move clearly designed to discourage its French suitor.

Aventis is planning to issue warrants that would be convertible into shares in the event of a hostile takeover by Sanofi and the loss of patent protection on Plavix. They would effectively give Aventis shareholders 57 per cent of the merged entity if this occurs, according to the company.

Novartis adopted a cautious stance on the overture, merely noting that is hoped "the supervisory board and management of Aventis will clarify with the French government the importance of such a transaction for the shareholders of Aventis as well as its benefits for employment and for research and development."​

Aventis also pointed to the widening gap between Sanofi's offer and Aventis share price, noting that it has gone from a 15 per cent premium to an 11 per cent discount since January, when Sanofi's intentions were first revealed.

But an uphill struggle still awaits Aventis as it tries to convince the French government of the merits of a Novartis tie-up. Last month, Novartis confirmed that it would be interested in such a deal, but stressed that the attitude of the French government - which is in favour of an all-French merger - was a serious obstacle to it making a bid.