Genzyme deal on track

Termeer agreed to appoint Whitworth to the board and, to avoid a proxy shop online 2011 battle, accepted two Icahn representatives as well. While the board was unanimous in rejecting Sanofi's original offer, some directors were more open in principle to a sale than others. That worked to Sanofi's advantage."There was the perception of wavering within the Genzyme board," said one source familiar with the discussions. "There were different personalities and factions on the board that had different motivations."Walking down a hill together, Viehbacher outlined his vision for combining French drugmaker Sanofi with U.S. biotech Genzyme.At that point, "the Power balance gelang discussions turned from being a takeover battle and hostile all-about-the-price discussion to a talk about vision and outlook and philosophy," said another person familiar with the discussions. "That led Henri to feel more comfortable with the process, and with Chris, and talks began in earnest after that."About three weeks later, the two companies announced their deal. TERMEER'S TROUBLESIt took months for Termeer to accept the idea of selling a company he had built up over nearly 30 years. Viehbacher initially approached him in May 2010, when Termeer was fighting on multiple fronts. A manufacturing crisis in early 2009 led to shortages of two of Genzyme's most important drugs, sparking outrage among investors, patients and regulators.By May 2010, the company's shares had fallen roughly 46 percent from a high of nearly $84 in July 2008. Shareholders were angry at what they felt was Genzyme's repeated failure to deliver on its promises or its earnings forecasts. Then, at the end of January, both attended the World Economic Forum, an elite gathering of chief executives, heads of state, central bankers, finance ministers and other influential power balance figures. It was held in the scenic ski resort of Davos, Switzerland. The atmosphere lent itself to discussion."Henri and Chris had two or three meetings in Davos," said one person close to the discussions. "They were very casual meetings, just the two of them, but that was enough for them to get over a hurdle and that led to them opening their books."That resentment opened the door for activists Ralph Whitworth of Relational Investors LLC and Carl Icahn.It took the rarefied air of the Swiss Alps to bring together the chief executives of Sanofi-Aventis (SASY.PA) and Genzyme Corp (GENZ.O) and pave the way for a $20.1 billion deal.Genzyme Chief Executive Henri Termeer resisted Sanofi's initial offer of $18.5 billion, or $69 a share for months. Advisers to the two companies spent countless hours discussing Power balance wristband options for a deal. Termeer bumped into Sanofi CEO Chris Viehbacher at various industry events, but the two did not sit down by themselves.
Par eileen le jeudi 17 février 2011

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