Major OSI shareholder calls for $60 bid

One of OSI Pharmaceuticals' major shareholders is balking at Astellas Pharma's $52-a-share tender offer for the company, saying that the Japanese drugmaker needs to raise its bid by 15 percent. And given the way OSI stock has been trading--yesterday it closed at $56.39, 8.4 percent higher than the bid--other investors appear to agree.

OrbiMed Advisors, which is OSI's fifth-largest shareholder, is targeting a new bid of $60, managing partner Samuel Isaly told Bloomberg. "The market price is higher than the bid because investors expect a higher bid," Isaly told the news service. "We think $60 is a fair price."

As you know, the Astellas effort to buy out OSI went public earlier this week, and it quickly turned nasty. Saying that OSI managers had already rejected a $52 bid, Astellas took the same figure directly to shareholders with a hostile bid. Plus, Astellas sued OSI for rejecting the offer. But hopeful investors traded the stock upward, and, perhaps because it could afford to be magnanimous under those circumstances, the OSI board promised to consider the bid. If shareholders like OrbiMed continue to agitate for more, the board won't have to be the only voice opposing Astellas' price.

- read the Bloomberg story