No sooner is one M&A deal agreed upon than market-watchers start speculating about the next. This time, it's AstraZeneca (AZN) in their sights, and the company's shares jumped in the U.K. on buyout talk. The word on the street is that Novartis (NVS) might soon be knocking on AstraZeneca's door with a buyout offer in hand.
Pharma is in the midst of a big wave of consolidation. But since the one-two-three announcements of the Pfizer/Wyeth combo, Merck and Schering-Plough's merger, and Roche's bid for the rest of Genentech, we haven't seen much Big Pharma-buys-Big Pharma action, while smaller deals hit the news almost daily. After all, smaller deals are less complex, and they take lots less cash. Buying AstraZeneca, for instance, would cost Novartis big bucks; the company is currently valued at £40 billion ($63.8 billion).
Of course, AstraZeneca has been tagged as a buyout target before. And there's the fact that Novartis recently recruited former AstraZeneca CFO Jonathan Symonds to take over the same job, giving the Swiss company an insider's view of its ostensible target. But analysts are skeptical; one called it an "unlikely story." We'll see who's right.
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