Sanofi SA (NYSE:SNY) could spark a fierce bidding war for Actelion Ltd (OTCMKTS:ALIOF). Johnson & Johnson (NYSE:JNJ) has already entered talks with Actelion after it sweetened its takeover offer for the company to more than $250 a share to value the Swiss biotechnology firm above $27 billion. But it has emerged that Sanofi is plotting a counterbid.
Sanofi has retained advisers to explore an Actelion acquisition, and sources say it has already informally expressed its takeover interest to Actelion. However, there is no guarantee the talks will progress or a deal would be reached.
Johnson & Johnson’s move to boost its offer for Actelion may have been designed to cement its position as the suitable bidder, but that move can be seen attracting counterbids for Actelion.
Sanofi is not the only major drug company that could make a counterbid for Actelion. Advisers of Actelion are reportedly reaching out to other potential buyers including Pfizer Inc. (NYSE:PFE) and Roche Holding Ltd. (ADR) (OTCMKTS:RHHBY) to see if they could be interested in making better bids for the company. Contacting other potential acquirers could put pressure on Johnson & Johnson to sweeten its offer further.
Winning the backing of Actelion co-founder and CEO
Even as Johnson & Johnson and Actelion enter buyout talks, Actelion’s co-founder and CEO Jean-Paul Cloz has been reluctant to sell the company. But Cloz is likely to accept a bid that offers sufficient premium.
Besides trying to stop rival Johnson & Johnson from laying its hands on Actelion, Sanofi’s counterbid could also help the company make for the loss of Medivation to Pfizer. After Pfizer ran away with Medivation, Sanofi promised to return to the buyout market if a compelling opportunity arose. Actelion is seen as that compelling opportunity.
Actelion valuations disqualifies Novartis
Though Actelion could also fit in the Novartis AG (NYSE:NVS) portfolio, the company said it is currently focused on buyouts that do not go beyond $5 billion.
Shares of Actelion shot up 1.4% to $208.82 in the last session. The stock has risen more than 51% so far in 2016.