Genzyme (GENZ) Rejects Offer From Sanofi

August 30, 2010, 4:11 PM

Biotechnology company Genzyme Corp. (Nasdaq: GENZ) opened Monday up $2.38 since it’s previous close. It was the leading advancer among the large-cap drug stocks on Monday afternoon.

Genzyme Corp. announced today that they have rejected the offer from Sanofi-Aventis for a $18.5 billion buyout as the offer undervalues the company.

After months of rumors, the French drug developer Sanofi offered $69 per share for Genzyme on Sunday. Shares of Genzyme hit a high of $70.47 on Monday which suggests shareholders may expect the bid to go even higher.

Genzyme Corp. has been struggling after manufacturing problems for key drugs Cerezyme and Fabrazyme for genetic conditions. Before speculation of a deal Genzyme shares closed at $49.86 on July 1st. Sanofi’s offer marked a 38% premium over that price.

Genzyme Chairman and CEO Henri A. Termeer stated that the board unanimously rejected the offer. The board is “not prepared to engage” in negotiations with an “unrealistic” starting price.

Genzyme focuses on rare genetic disease disorders, renal diseases, orthopedics, cancers, transplant and immune diseases, and diagnostic and predictive testing areas. The company has promising drugs for high cholesterol and other disorders in late development and is considered attractive.

Shares of Genzyme closed at $69.91 on Monday.

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Tags: cerezyme, fabrazyme, genz, genzyme, sanofi