M&A

Stiff-armed by a stubborn Actelion, J&J takes its check book and walks away, leaving an opening for Sanofi

And then it was over.

J&J kept it short and sweet this evening, announcing it has ended talks with Actelion about a possible buyout. “Johnson & Johnson was not able to reach an agreement that it believed would create adequate value for its shareholders,” the company said.

The statement ends two weeks of speculation about an acquisition, as the reluctant Swiss biotech stubbornly held off on a deal as it came up with some suggestions about how it could remain independent, and still have J&J acquire it.

Actelion shares $ATLN are down about 10% today.

At last word Actelion was resisting a bid that would value the company at $27 billion and Sanofi $SNY, frustrated in its attempt to acquire Medivation, was circling the deal table in search of an opening.

Sure enough, shortly after J&J $JNJ made its exit official, news reports began to surface that Sanofi is stepping up to see if it can do a deal. If so, the Swiss biotech won’t come cheap, underscoring recent trends where big premiums have been needed to nail down significant acquisitions. The Wall Street Journal says that some of their sources close to the talks believe it could take $30 billion to do this deal.

Sanofi would have no trouble coming up with the cash, but it has repeatedly said to would not commit to any deal that would bust the $20 billion mark. Desperate to complete some sort of major M&A deal, though, CEO Olivier Brandicourt may be persuaded to bust out.

 


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