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Medivation Shareholder Support can be won over says a Confident Sanofi


04/29/2016


Medivation Shareholder Support can be won over says a Confident Sanofi
Boosted by its Genzyme division, is confident Medivation shareholders will back its proposed takeover of the U.S. cancer drug company, Sanofi, reported higher quarterly profit on Friday.
 
Setting up what could be a lengthy battle with a $9.3 billion offer to buy Medivation after it stonewalled its takeover approach, the French drugmaker went public on Thursday with the news of the offer.
 
"We are confident that Medivation shareholders will ultimately share our strong belief that our offer ... would provide significant and immediate cash value," Sanofi Chief Executive Olivier Brandicourt said on a conference call.
 
However confirmation about whether Sanofi was ready to engage in a bidding war were declined to be given by Chief Financial Officer Jerome Contamine.
 
While saying that there was no guarantee a deal would be reached, Medivation, which markets prostate cancer drug Xtandi, said in a statement that its board would meet to discuss Sanofi's proposal and provide an update "promptly".
 
The U.S. company said shareholders should take no action at this time.
There was a fall in the shares of Sanofi following the news.
 
Equivalent to a 0.2 percent drop on a reported basis, Sanofi said first-quarter business net profit grew 3.5 percent at constant exchange rates to 1.72 billion euros ($1.96 billion).
 
Sanofi said that it was confirming its full-year forecasts as the company added tat the Sales rose 0.7 percent at constant exchange rates to 8.54 billion euros, down 1.9 percent on a reported basis.
 
Business net profit of 1.7 billion euros and net sales of 8.73 billion on an average was expected by analysts polled by Reuters.
 
With a 134 percent rise in proceeds from multiple sclerosis treatment Lemtrada, revenue at biotech arm Genzyme rose 20.5 percent. Reflecting the trend of a weaker revenue from blockbuster Lantus in the United States, Lemtrada. Diabetes sales fell 4.5 percent.
 
Bernstein analyst Tim Anderson said in a note that Sanofi's "main diabetes franchise remains in flux, with the company lowering estimates twice for this business over the last 18 months".
 
"(Sanofi's) research and development track record is not great, and it is guiding for no meaningful earnings per share growth in 2016/2017," said Anderson, who downgraded the stock to market-perform in November.
 
(Source:www.reutrs.com) 


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