Astra confident of MedImmune deal despite lawsuit
Wed May 16, 2007 5:22 AM ET
By Ben Hirschler
LONDON, May 16 (Reuters) - AstraZeneca Plc <AZN.L> expressed confidence on Wednesday that its $15.6 billion acquisition of MedImmune Inc. <MEDI.O> would go ahead, despite a lawsuit contesting the deal from an investor in the U.S. biotech firm.
Chris Larson of San Diego filed a class-action lawsuit against MedImmune and its senior officers and directors, claiming the sale benefited them more than ordinary shareholders.
"This is a matter for MedImmune as AstraZeneca is not party to the suit. However, MedImmune's SEC filing states that it does not believe the suit has any merit. Therefore we are confident that the deal will go ahead," an AstraZeneca spokesman said.
Larson filed his suit in a Montgomery County, Maryland, court on April 25 -- two days after the deal was announced -- but it was disclosed in a U.S. Securities and Exchange Commission filing only this week.
His claim argues that MedImmune insiders "will reap disproportionate benefits to the exclusion of maximizing stockholder value".
His lawsuit states: "Instead of attempting to obtain the highest value reasonably available for the company's stockholders, defendants spent a substantial effort tailoring the acquisition to meet the specific needs of AstraZeneca."
Defendants in the lawsuit include MedImmune Chief Executive and President David Mott and founder and Chairman Wayne Hockmeyer, both of whom stand to receive substantial payouts from the sale.
Larson asked the court to stop the merger unless and until MedImmune takes steps to ensure the highest possible value for shareholders.
AstraZeneca won the bidding for MedImmune after a competitive auction. Many analysts say it will be overpaying if the deal goes through.
In its final negotiations, AstraZeneca increased its offer to $58 a share from a non-binding $50 on April 5, according to SEC filings.
The all-cash purchase of MedImmune is the biggest transaction since the creation of the Anglo-Swedish drugs group in 1999 and will take AstraZeneca deeper into biotech medicine.
AstraZeneca said last month it hoped to close the deal in June 2007. |
