Sanofi-Aventis is plotting a big acquisition in the U.S., sources tell Bloomberg, but there's no word yet on the identity of the supposed target. What they do say is that the deal may be worth $20 billion or more--a price that would top what Sanofi's spent on all its acquisitions since Christopher Viehbacher took over as CEO in 2008.
Viehbacher reportedly briefed Sanofi's board on the potential deal at a special meeting this week. The company wouldn't comment on the "market rumors" for either Bloomberg, Reuters or the Wall Street Journal. Analysts named Allergan (market value of $17 billion) and Biogen Idec ($12.5 billion) as possible targets.
Now, we all know Sanofi is in the market for acquisitions. "They've been very clear external growth is part of their plan," Pictet Asset Management's Marc Booty told the news service. But the French drugmaker typically goes for bite-sized deals. Sanofi has snapped up 25 companies during Viehbacher's tenure, Bloomberg notes, which puts the average deal size at $680 million. And the biggest of those deals was the $4 billion acquisition of Merck's half of their animal health joint venture, Merial.
So, a $20 billion deal would be an anomaly--not an impossibility, but definitely a departure from Viehbacher's modus operandi. Indeed, Viehbacher himself told Bloomberg in February that he'd like to stick to deals of $15 billion or less.
Sanofi's stock was down on the news; analysts pegged the dip to worries about the potential buyout's price tag. But given the fact that it's still in the early stages, this big buy might not materialize.
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