Genzyme says company worth $89 per share to potential buyer

Genzyme announced that earnings for 2011 are expected to be in the range of $4.30 to $4.60 per share, far exceeding analysts' estimates of $3.85 per share. Based on the mid-point of these earnings, the company said at an investors meeting that any potential buyer should offer at least $89 per share for the drugmaker.
The biotechnology company also suggested that sanofi-aventis' previously rejected hostile takeover offer of $69 per share, which marks a 38-percent premium to Genzyme's share price on July 1, is not in line with prices paid in similar acquisition deals. Genzyme indicated that a median premium of 73 percent is a more appropriate benchmark for a takeover.
Genzyme claims that sanofi-aventis' offer undervalues its drug pipeline and fails to recognise anticipated revenue growth after fixing manufacturing problems that led to drug shortages. Genzyme said that it will launch three new drugs in 2013 that sanofi-aventis hasn't included in its valuations, including an additional indication for its cancer drug, Campath (alemtuzumab), as a treatment for multiple sclerosis that Genzyme says could see annual sales reach $3 billion. BioMedTracker has forecast that Campath sales could reach $1.6 billion in 2019, while some analysts project figures closer to $2 billion.
The French company has indicated it would be willing to increase its price if Genzyme provided details to justify a better offer, but Genzyme has thus far refused. The biotechnology company also disclosed that it had begun to evaluate other potential suitors.
In announcing its earnings forecast, the drugmaker said it anticipates that revenue will be in the range of $5 billion to $5.1 billion. The company said it plans to achieve the targets by increasing sales, cutting costs and divesting certain parts of its business.

Reference Articles
Genzyme says sanofi should raise offer to $89 a share - (Bloomberg)
Genzyme sees 2011 adjusted EPS $4.30-$4.60, est. $3.85 - (Bloomberg)
Termeer: Genzyme profits to double in 2011 - (Boston Business Journal)
Genzyme details financial recovery and other factors driving company’s value - (Genzyme)
Genzyme issues new financial forecast - (MarketWatch)
Genzyme 2011 EPS view above Street; makes case against sanofi - (NASDAQ)
Genzyme makes case for higher sanofi deal value - (Yahoo!Finance)
Genzyme boss counters sanofi-aventis hostile bid - (Yahoo!News)

**Published in "First Word"