PARIS - France's Sanofi-Aventis Monday launched an $18.5 billion hostile takeover attempt for Genzyme Corp., escalating the battle after the U.S. biotech company's management twice rejected its offer.
At $69 per share, it's the same as the friendly bid Paris-based Sanofi-Aventis offered for Genzyme privately in July and publicly in August. Genzyme rejected the offer both times.
Genzyme, based in Cambridge, Mass., urged shareholders Monday to take no action, saying in a news release its board would review the offer, together with its independent consultants, and advise shareholders within 10 business days.
Chris Viehbacher, Sanofi's chief executive, told analysts and reporters during conference calls that he went straight to shareholders because Genzyme management "refused to engage in constructive discussions" despite several attempts by his company.
Genzyme would give Sanofi a new platform for growing its biotech business, let it expand into the growing - and lucrative - market for drugs for rare diseases, increase its U.S. presence and give it more experimental drugs in mid- and late-stage testing. Those include three for high cholesterol, a huge global market.
And Genzyme has said it is close to resolving manufacturing problems that have limited sales of two key drugs for genetic disorders.
Meanwhile, Sanofi must come up with new revenue as three of its top four products - anti-clotting medicines Lovenox and Plavix and cancer drug Taxotere - have new generic competition or are about to get it. That competition will put just more than $10 billion in annual sales at risk.
In August, Genzyme said the $69 per share offer undervalued the company. Last week, Genzyme chief executive Henri Termeer said a fairer value would be closer to $80, its price before the 2008 financial crisis and the company's subsequent manufacturing problems.