Medivation, Sanofi Move Closer to Showdown in Takeover Bid
In response to a request by Sanofi, the biopharmaceutical company, Medivation, set a record date of June 1, 2016, for the shareholders of the company to give their written consent to remove and replace each member of the Medivation Board of Directors. Sanofi is seeking to replace the board as part of its $9.3 billion takeover bid of Medivation.
After the record date, Medivation directors can be removed and replaced at any time by shareholders delivering consents representing a majority of the outstanding shares. Medivation set the June 1 record date pursuant to Sanofi’s request, also made on June 1.
The move forces a showdown of Sanofi’s takeover bid. In making a move to field a new Board of Directors, Sanofi said in a statement last month that the candidates it is recommending “are willing to fully and fairly evaluate all of Medivation's strategic options, including Sanofi's acquisition offer, in accordance with their fiduciary duties to Medivation and its shareholders.”
Sanofi Chief Executive Officer Olivier Brandicourt said: “Despite multiple attempts, both prior to and following the public disclosure of Sanofi's proposal, Medivation has thus far refused to engage with us regarding the merits of a value creating transaction. Unfortunately, this has left us with no choice but to commence a process to elect directors who are more open to supporting the best interests of Medivation shareholders regarding a potential transaction.”
Medivation has thus far rejected Sanofi’s interest in acquiring the company, first rejecting a proposed acquisition in late April and again in early May. Sanofi took the strategy of replacing the Medivation board following the rejection of those efforts.
Medivation’s key product is Xtandi (enzalutamide), a drug to treat prostate cancer, for which it is partnered with Astellas. In its first-quarter earnings release, Medivation reported that US net sales of Xtandi, as reported by Astellas, are expected to range between $1.425 and $1.525 billion in 2016.