Frustrated Sanofi takes bid to Genzyme shareholders

Sanofi-Aventis got tired of waiting. The French drugmaker has gone hostile with its $18.5 billion bid for Genzyme, hoping to gain more traction with shareholders than it did with management. As Cowen & Co.' s Phil Nadeau tells Bloomberg, "If they can't get through Genzyme's management, they'd be silly not to approach the shareholders directly." The tender offer expires December 10.

It's been more than a month since Genzyme first stiff-armed Sanofi's advances, and Sanofi's prodding since hasn't yielded much. A Sept. 20 meeting with Genzyme chief Henri Termeer (photo) was "unproductive," Sanofi CEO Chris Viehbacher (photo) says; Termeer wouldn't give out any info on the company's manufacturing overhaul, and he declined to offer "perspective on an appropriate valuation."

A series of meetings with Genzyme shareholders, on the other hand, led Viehbacher to believe he should push forward. In a letter to Termeer, Viebacher says the shareholders "are supportive of our initiative and, like us, are frustrated with your refusal to have meaningful discussions with us regarding our proposal."

Chances are, the company will end up boosting its $69-per-share offer, analysts say. But they weren't surprised Sanofi came out with a hostile bid that's no higher than its friendly offer. Yes, Genzyme's management scoffed at that price. But, as Viehbacher notes, there's no need for Sanofi to bid against itself at this stage. He holds out the possibility that a higher price could be in the offing: "There's no one single price for anything and obviously if someone put some new information on the table we'd be ready to look at it," he told CNBC. Analysts are betting on $75. We'll see what the shareholders think.

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