1. Genzyme Refocus
The Wall Street Journal yesterday told us that Genzyme is selling one of its non-core units, its genetic-testing business, as part of its effort to "fend off" the takeover efforts of Sanofi-Aventis SA.
Genzyme is apparently trying to rid itself of two other units also, a diagnostics concern (that sells tests and testing supplies) and a pharma intermediaries operation. The proceeds from these sales are supposed to go into a pot whence the company will buy back $2 billion of its stock.
2. Mike Castle
Rep. Mike Castle (R-Del.) lost a hotly contested primary campaign in yesterday's voting in Delaware. The usual characterization of this race has been that Castle represents the Republican "establishment" while Christine O'Donnell is the Palin-endorsed, tea-partying "insurgent." As my use of scare quotes indicates, I take such characterizations with more than a grain of salt -- and I don't take salt in my tea. Here's a story from Monday from the AP, about the home stretch of that campaign.
What I do know about Mike Castle, though, is that he was half of the team of Capuano and Castle. Together, he and Michael Capuano (D-Mass.) introduced the Hedge Fund Adviser Registration Act of 2009. It didn't become law as such, but it was one important step in the long legislative history that led to Dodd-Frank, the bill that did become law (with Castle's support)in July 2010.
3. Casey's General Stores
The logic behind consolidation in the retail "convenience outlets" market remains strong. The situation with regard to Casey's General Stores remains confusing.
As regular readers of Proxy Partisans may remember, Alimentation Couche-Tard, the Canadian convenience store concern that owns the Circle K brand, bid $36 a share for Casey's in April, and raised that to $36.75 in May. That price valued Casey's at $1.9 million.
Casey's has resisted, and to good effect. On September 1 the bid went up again, to $38.50 per share.
Even since then, there's a new suitor. Casey's has revealed that it is in talks with a white knight, 7-Eleven Inc. They are talking about a $40 a share offer, though so far that is merely vapor.
Showing posts with label Genzyme. Show all posts
Showing posts with label Genzyme. Show all posts
Wednesday, September 15, 2010
Monday, August 30, 2010
Sanofi and Genzyme: They'll do it the hard way
Negotiations for a friendly merger between Sanofi-Aventis and Genzyme, which I discussed here a month ago, now seem to have fallen apart.
Sanofi's CEO has written a "bear hug" letter in the first instance to the Genzyme CEO but in reality to the Genzyme shareholders. The idea is to get the shareholders ticked off that their management is standing between them and a nice pay-out.
Here's a discussion from two and a half years ago about the art of giving a bear hug.
A little history. Back in 2004, a company then called Sanofi-Synthélabo made a 47.8 bn euro for Aventis, a Strasbourg based concern. At first, Initially, Aventis spurned the bid, and a three-month battle resulted. The merger did in time come about, but the price increased, from the original 47.8 billion to 54.5 billion euros.
The French government played a big role in that imbroglio. The government was concerned that a Swiss company (Novartis) would step in as Aventis' white knight if Sanofi-Synthélabo didn't raise its bid. That would lead to Aventis falling under the control of foreigners. Indeed, non-EU foreigners! (The Swiss are only geographically part of Europe.)
The lesson: there is good reason, based on their fiduciary obligation to their shareholders, for the management of Genzyme to make this difficult for Sanofi. They shouldn't make it impossible, but they should make it difficult.
Sanofi's CEO has written a "bear hug" letter in the first instance to the Genzyme CEO but in reality to the Genzyme shareholders. The idea is to get the shareholders ticked off that their management is standing between them and a nice pay-out.
Here's a discussion from two and a half years ago about the art of giving a bear hug.
A little history. Back in 2004, a company then called Sanofi-Synthélabo made a 47.8 bn euro for Aventis, a Strasbourg based concern. At first, Initially, Aventis spurned the bid, and a three-month battle resulted. The merger did in time come about, but the price increased, from the original 47.8 billion to 54.5 billion euros.
The French government played a big role in that imbroglio. The government was concerned that a Swiss company (Novartis) would step in as Aventis' white knight if Sanofi-Synthélabo didn't raise its bid. That would lead to Aventis falling under the control of foreigners. Indeed, non-EU foreigners! (The Swiss are only geographically part of Europe.)
The lesson: there is good reason, based on their fiduciary obligation to their shareholders, for the management of Genzyme to make this difficult for Sanofi. They shouldn't make it impossible, but they should make it difficult.
Tuesday, July 27, 2010
Three brief items
1. Auction for Genzyme?
Genzyme Corp., a biopharm company based in Cambridge, Mass., has rejected a takeover offer from Sanofi-Aventis, the largest drug manufacturer in France.
According to a Bloomberg story, the discussions thus far have been informal, but "Sanofi may send a formal letter to Genzyme detailing its interest in an acquisition as soon as this week."
Genzyme has had the pleasure of Carl Icahn's company for some time now. Icahn curently controls two seats on the board. Icahn will surely make his views on the subject known if this does play itself out over the weeks to come.
GlaxoSmithKline is also sometimes mentioned as an interested party, so a real auction for Genzyme is a possibility.
2. Higher cross-border bid.
Alimentation Couche-Tard, the Canadian convenience store concern that owns the Circle K brand, has increased its bid for Casey's General Stores. It was bidding $36 a share in April and has now raised that to $36.75.
This values Casey's at $1.9 million, including debt says DealBook.
The offer expires at 5 PM on August 6 -- which, it so happens, is my baby sister's birthday. (Hello, Beth!)
Oh, and perhaps I' naive, but this strikes me as odd.
3. GSI Group Emerges from Chapter 11.
GSI is a multi-national family of companies that supply parts ("precision technology") to the medical, electronics, and industrial markets. Parts that, so far as I can tell, involve lasers.
Three of the entities within this family filed for chapter 11 reorganization in November 2009, in Delaware: GSI Group Inc., the parent Canadian holding company; GSI Group Corp., of Massachusetts; and MES International, Inc., a non-operating subsidiary of GSI Group Corp.
But now they have returned from that legal world of the undead to that of the truly living.
The Boston Business Journal, in May, described the descent into bankruptcy as
"a slew of regulatory and accounting setbacks that stemmed from revenue-booking practices between 2004 and 2008."
That got me curious, so I went here. Seventeen months ago, and eight months before its bankruptcy filing, GSI announced the results of an internal accounting probe and admitted to material revenue-recognition errors.
Genzyme Corp., a biopharm company based in Cambridge, Mass., has rejected a takeover offer from Sanofi-Aventis, the largest drug manufacturer in France.
According to a Bloomberg story, the discussions thus far have been informal, but "Sanofi may send a formal letter to Genzyme detailing its interest in an acquisition as soon as this week."
Genzyme has had the pleasure of Carl Icahn's company for some time now. Icahn curently controls two seats on the board. Icahn will surely make his views on the subject known if this does play itself out over the weeks to come.
GlaxoSmithKline is also sometimes mentioned as an interested party, so a real auction for Genzyme is a possibility.
2. Higher cross-border bid.
Alimentation Couche-Tard, the Canadian convenience store concern that owns the Circle K brand, has increased its bid for Casey's General Stores. It was bidding $36 a share in April and has now raised that to $36.75.
This values Casey's at $1.9 million, including debt says DealBook.
The offer expires at 5 PM on August 6 -- which, it so happens, is my baby sister's birthday. (Hello, Beth!)
Oh, and perhaps I' naive, but this strikes me as odd.
3. GSI Group Emerges from Chapter 11.
GSI is a multi-national family of companies that supply parts ("precision technology") to the medical, electronics, and industrial markets. Parts that, so far as I can tell, involve lasers.
Three of the entities within this family filed for chapter 11 reorganization in November 2009, in Delaware: GSI Group Inc., the parent Canadian holding company; GSI Group Corp., of Massachusetts; and MES International, Inc., a non-operating subsidiary of GSI Group Corp.
But now they have returned from that legal world of the undead to that of the truly living.
The Boston Business Journal, in May, described the descent into bankruptcy as
"a slew of regulatory and accounting setbacks that stemmed from revenue-booking practices between 2004 and 2008."
That got me curious, so I went here. Seventeen months ago, and eight months before its bankruptcy filing, GSI announced the results of an internal accounting probe and admitted to material revenue-recognition errors.
Tuesday, June 15, 2010
Icahn, Genzyme Reach Agreement
Icahn and Genzyme had been waging a proxy contest in connection with the annual meeting scheduled for tomorrow, June 16.
Now, though, they have kissed and made up. Genzyme has agreed to increase the size of its board from 10 to 13. One of Icahn's nominees, Steven Burakoff, will fill one of the three new seats. Another one of the three new board members, Eric Ende, was a participant in the Icahn proxy solicitation. The third new appointee, Dennis Fenton, appears not to have an Icahn connection.
Fenton was the executive vice president in charge of operations at Amgen until his retirement from there in 2008.
But back to Burakoff. He is a cancer specialist, teaching oncology at the Mount Sinai School of Medicine, and leading the Tisch Cancer Institute at the Mount Sinai Medical Center.
Dr. Ende, a participant in the Icahn funds’ proxy solicitation, is a former biotechnology analyst with Merrill Lynch & Co. Inc.
Icahn made the usual gracious noises when agreement was reached: “I am always pleased when a proxy fight can be avoided. I believe Drs. Burakoff and Ende will add significant medical and financial expertise to the Genzyme board. I am also very heartened that the Genzyme board recently brought on Ralph Whitworth, a longtime activist, as a director, and announced that Dennis Fenton will shortly be added to the board as well.”
Now, though, they have kissed and made up. Genzyme has agreed to increase the size of its board from 10 to 13. One of Icahn's nominees, Steven Burakoff, will fill one of the three new seats. Another one of the three new board members, Eric Ende, was a participant in the Icahn proxy solicitation. The third new appointee, Dennis Fenton, appears not to have an Icahn connection.
Fenton was the executive vice president in charge of operations at Amgen until his retirement from there in 2008.
But back to Burakoff. He is a cancer specialist, teaching oncology at the Mount Sinai School of Medicine, and leading the Tisch Cancer Institute at the Mount Sinai Medical Center.
Dr. Ende, a participant in the Icahn funds’ proxy solicitation, is a former biotechnology analyst with Merrill Lynch & Co. Inc.
Icahn made the usual gracious noises when agreement was reached: “I am always pleased when a proxy fight can be avoided. I believe Drs. Burakoff and Ende will add significant medical and financial expertise to the Genzyme board. I am also very heartened that the Genzyme board recently brought on Ralph Whitworth, a longtime activist, as a director, and announced that Dennis Fenton will shortly be added to the board as well.”
Wednesday, June 2, 2010
Genzyme and the FDA
The Food and Drug Administration (FDA) has entered into a consent decree with Genzyme Corp. (GENZ), a Cambridge, Mass. based biopharm concern that has been one of the unwelcome objects of the attentions of activist investor Carl Icahn.
Icahn now owns just under 5% of the equity of the company, after having doubled his holdings in the first quarter. This is what I said about Genzyme in January.
In recent days, Genzyme has trumpeted two words from the FDA. First, that it has approval to market Lumizyme (its trademark product, chemically known as alglucosidase alfa) for patients with late-onset Pompe disease. Here's more on Pompe disease.
Second, that it has entered into a consent decree with the FDA, ending a dispute over the company's Allston manufacturing plant. The company said that this gives it "further clarity and certainty in our ongoing improvements to our manufacturing and quality systems at our Allston Landing facility."
Icahn, though, portrays the consent decree as bad news for stockholders, not good. It will bring with it tighter FDA scrutiny. The FDA, he writes in a recent "Dear Fellow Shareholder" letter, "has seemingly lost faith in the company's ability to make important drugs for patients. Why should shareholders not look to recharge the board with strong managerial talent and fresh ideas that can ask the right questions and demand performance?"
The meeting has been set for June 16.
Icahn now owns just under 5% of the equity of the company, after having doubled his holdings in the first quarter. This is what I said about Genzyme in January.
In recent days, Genzyme has trumpeted two words from the FDA. First, that it has approval to market Lumizyme (its trademark product, chemically known as alglucosidase alfa) for patients with late-onset Pompe disease. Here's more on Pompe disease.
Second, that it has entered into a consent decree with the FDA, ending a dispute over the company's Allston manufacturing plant. The company said that this gives it "further clarity and certainty in our ongoing improvements to our manufacturing and quality systems at our Allston Landing facility."
Icahn, though, portrays the consent decree as bad news for stockholders, not good. It will bring with it tighter FDA scrutiny. The FDA, he writes in a recent "Dear Fellow Shareholder" letter, "has seemingly lost faith in the company's ability to make important drugs for patients. Why should shareholders not look to recharge the board with strong managerial talent and fresh ideas that can ask the right questions and demand performance?"
The meeting has been set for June 16.
Sunday, January 10, 2010
Three brief items
1. Icahn Fight May be Brewing
Carl Icahn may be ready to wage aproxy contest against Genzyme, a Massachusetts-based biotech firm. He bought 1.5 million Genzyme shares in the third quarter, perhaps toward that end.
Meanwhile, Genzyme has entered into a "mutual cooperation agreement" with Relational Investors LLC, one of its top shareholders. A good releationship there may be quite useful if Icahn is in fact ready for battle.
Icahn built up a substantial position in Genzyme in 2007, then sold it by year's end.
2. News from Venezuela
Hugo Chavez, the President of Venezuela, has announced the devaluation of that country's currency, the bolivar. It had been pegged to the US dollar at 1:2.15. Now Chavez is adopting a dual exchange system, treating the importation of "essential goods" differently, and maintaining something close to the old peg for those goods, but adopting a ratio of 1:4.3 otherwise.
The Chavez regime may be headed for a fall. This move, a Rube Goldberg machine for currency control, has the look of desperation.
3. Another quote from Duff McDonald.
A week ago today, in a blog entry here, I quoted a passage from Duff McDonald's new book about Jamie Dimon and JPMorgan Chase, "Last Man Standing." This passage concerns Morgan Chase's purchase of WaMu's deposits and loan portfolios in a deal brokered by the OTS and FDIC in the hectic days of September 2008.
It took awhile for news of this deal to get to Alan Fishman, WaMu's CEO. But I'll let McDonald tell it.
"Remarkably, the staff of WaMu found out about the deal before Fishman, who'd been on a plane at the exact moment of the seizure and sale. Because of the importance of keeping the deal under wraps until it was announced, JPMorgan Chase staffers had worked with WaMu's auditors to get access to WaMu's internal network before the news broke. In the process, they secured a list of employee's e-mail addresses without having to get them through WaMu's top management. Within minutes of the deal, too, visitors to www.WaMu.com were greeted by a message from Chase welcoming customers to JPMorgan Chase. This too had been prepared on the sly."
Pieces of the maneuverings of that autumn keep falling into place. That one paragraph speaks to me vividly, because I last year became very interested in the bankruptcy proceedings affecting WaMus's holding company, WMI. The WMI proceedings are still quite confused because the hurried sale of the assets of the operational company left a lot undone.
Carl Icahn may be ready to wage aproxy contest against Genzyme, a Massachusetts-based biotech firm. He bought 1.5 million Genzyme shares in the third quarter, perhaps toward that end.
Meanwhile, Genzyme has entered into a "mutual cooperation agreement" with Relational Investors LLC, one of its top shareholders. A good releationship there may be quite useful if Icahn is in fact ready for battle.
Icahn built up a substantial position in Genzyme in 2007, then sold it by year's end.
2. News from Venezuela
Hugo Chavez, the President of Venezuela, has announced the devaluation of that country's currency, the bolivar. It had been pegged to the US dollar at 1:2.15. Now Chavez is adopting a dual exchange system, treating the importation of "essential goods" differently, and maintaining something close to the old peg for those goods, but adopting a ratio of 1:4.3 otherwise.
The Chavez regime may be headed for a fall. This move, a Rube Goldberg machine for currency control, has the look of desperation.
3. Another quote from Duff McDonald.
A week ago today, in a blog entry here, I quoted a passage from Duff McDonald's new book about Jamie Dimon and JPMorgan Chase, "Last Man Standing." This passage concerns Morgan Chase's purchase of WaMu's deposits and loan portfolios in a deal brokered by the OTS and FDIC in the hectic days of September 2008.
It took awhile for news of this deal to get to Alan Fishman, WaMu's CEO. But I'll let McDonald tell it.
"Remarkably, the staff of WaMu found out about the deal before Fishman, who'd been on a plane at the exact moment of the seizure and sale. Because of the importance of keeping the deal under wraps until it was announced, JPMorgan Chase staffers had worked with WaMu's auditors to get access to WaMu's internal network before the news broke. In the process, they secured a list of employee's e-mail addresses without having to get them through WaMu's top management. Within minutes of the deal, too, visitors to www.WaMu.com were greeted by a message from Chase welcoming customers to JPMorgan Chase. This too had been prepared on the sly."
Pieces of the maneuverings of that autumn keep falling into place. That one paragraph speaks to me vividly, because I last year became very interested in the bankruptcy proceedings affecting WaMus's holding company, WMI. The WMI proceedings are still quite confused because the hurried sale of the assets of the operational company left a lot undone.
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