Glaxo Raises Human Genome Bid to $14 a Share, Reuters Says
The proposed cash purchase is subject to approval of some last-minute details and may be announced before markets open in the U.S., Reuters said on its website today. Sarah Spencer, a spokeswoman for Glaxo in London, declined to comment on the report. A voice mail message left with Human Genome’s corporate communications office outside business hours wasn’t returned.
Glaxo’s earlier $13-a-share offer for Human Genome, which valued the Rockville, Maryland-based biotechnology company at $2.6 billion, is set to expire at 5 p.m. New York time July 20. Human Genome rose as much as 4.6 percent to 11.55 euros ($14.13) in German trading. Glaxo rose 0.5 percent to 1,453.50 pence at 8:42 a.m. in London.
Human Genome shares have traded above the offer price since Glaxo took its proposed takeover hostile on May 9, signaling that investors expected an increased bid. Human Genome was valued at about $2.7 billion at the end of New York trading on July 13. Glaxo went directly to Human Genome shareholders after the company rebuffed its approaches. Human Genome had set a deadline of today for competing bids.
Buying Human Genome would give Glaxo full control over marketing Benlysta, a treatment for lupus. The companies share revenue and profits from the drug equally.
Glaxo and Human Genome are also collaborating on two experimental medicines that are in late-stage testing: albiglutide for diabetes and darapladib for hardening of the arteries. Human Genome has the right to receive royalties of 10 percent on sales of darapladib and 5 percent on sales of albiglutide.
Human Genome said on May 17 it was in talks with “major” pharmaceutical and biotechnology companies about a potential transaction and adopted a so-called “poison pill” shareholder rights plan to deter the hostile takeover.
Such defenses are engineered to make unwanted takeover bids prohibitively expensive by allowing existing shareholders to buy new shares at a discount when the bid is made. That drives up the cost of the acquisition.
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