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Strategies & Market Trends : Speculating in Takeover Targets -- Ignore unavailable to you. Want to Upgrade?

To: richardred who wrote (1033)	1/29/2006 9:06:38 PM
From: richardred	Read Replies (1) \| Respond to of 7243

GSK considers cut-price bid for Serono By Andrew Jack Sunday, January 29, 2006 Posted: 05:50 PM EST (22:50 London) GlaxoSmithKline, the UK-based pharmaceuticals group, is again considering a possible bid for Serono, the Swiss biotechnology business, after an auction earlier this month failed to find a buyer for the company at the $15bn asking price. GSK is considering offering a lower price for the company, as Goldman Sachs (NYSE:GS) , which is advising Serono, attempts to find fresh purchasers for the 62 per cent stake held by the family of Ernesto Bertarelli, chief executive, as a precursor to a public offer for the outstanding shares, people close to the discussions said. A takeover would mark fresh consolidation in the pharmaceutical sector and the end of independence for Europe's largest biotechnology group. It reflected a widely-held belief among analysts that Serono was a relatively mature company with growing competition for existing products and a disappointing pipeline of drugs in development. However, at a lower price a number of pharmaceutical companies could still be interested in Serono's operations, including Rebif, its top-selling multiple sclerosis drug. People close to the discussions insisted that negotiations to find a purchaser remained "ongoing", although one indicated that the procedures for a new round of bidding remained unclear. Novartis of Switzerland was widely seen as a likely bidder, but executives have repeatedly played down the likelihood of a deal. Johnson & Johnson of the US has also been tipped as a potential purchaser, as has Pfizer, the world's largest pharmaceuticals group. GSK, which declined comment on Sunday, may have a portfolio which offers relatively little overlap with Serono's, and could potentially sell off parts of the company. Serono shares closed at SFr973 on Friday, giving the group a market value of SFr14.8bn. The shares hit a 52-week high of SFr1,105 last November but have fallen back in recent weeks as takeover hopes appeared to recede. us.ft.com