Genzyme, Bioenvision merger on the rocks
biotech company's proposed $345m (€242m) takeover by Genzyme as it
is preparing to vote against the merger arguing the offer is too
low.
SCO Capital Partners, which owns a 13 per cent stake in Bioenvision said in a letter, sent to the New York-based firm's board members yesterday, that the $5.60-a-share offer made by Genzyme was "extremely inadequate" and the result of "a poorly managed and ill-timed sales process". SCO added it anticipates that the shareholders will not approve the merger when they are expected to give their vote on Thursday. "We believe Bioenvision will be well positioned, within a three to six month timeframe, to engage an independent investment bank to do a well-run process to market the company to possible acquirers," said SCO chairman Steven Rouhandeh in his letter. He added that SCO intends to propose a new slate of directors, for the next annual shareholder's meeting. This latest development came just four days after Massachusetts-based Genzyme said it will not raise its offer to buy Bioenvision, sticking to the original deal signed in May. Genzyme said last week its bid for the 78 per cent stake it does not already own in Bioenvision is its "best and final offer". In July, the biopharma giant extended its offer after only a minority of Bioenvision's shareholders backed the acquisition and said that in the eventuality where the merger was not to close, it would remain a significant common stockholder of Bioenvision and hold all the preferred stock of the company, along with the right to approve or disapprove any merger. The two companies are already business partners as they share rights to clofarabine, a drug that treats a type of leukaemia in children. Genzyme sells the drug in the US as Clolar while Bioenvision markets it in Europe.
