Human Genome Finally Agrees to GlaxoSmithKline Buyout
On Monday, Benzinga reported that GlaxoSmithKline was preparing for the takeover, and that it had offered roughly $14 per share. However, the deal had yet to be finalized. In fact, Glaxo is paying $14.25 per share in cash.
On April 19, Benzinga reported that Glaxo had bid for Human Genome, saying, "Glaxo bid $13 per share in cash and, despite the sentiment from HGSI, that bid does display confidence in its experimental drugs for diabetes and cardiovascular disease.
"While it has yet to be determined how this offer will affect the working relationship (one would imagine that it would be a little awkward for a while), GSK is continuing to conduct clinical trials on the compound. It hopes to disclose data on the diabetes drug this coming summer.
"HGSI has hired Goldman Sachs to advise on the sale or strategic alternatives. GSK has been invited to participate in this process. For its part, Glaxo has said that it will issue a statement shortly."
On May 9, Benzinga reported that Glaxo was looking to make a hostile takeover approach, with Glaxo releasing a statement that said, "Shareholders should have the opportunity to decide for themselves on the merits of the offer."
But on May 17, Benzinga reported that Human Genome seemed keen to sell to anybody but GlaxoSmithKline, saying, "Human Genome does seem to want to proceed with a deal, but it will not be bullied and analysts are predicting that a deal will get done for a fee in the region of $15 per share. While the company's attempts to find another buyer may be little more than a healthy game of hardball, GSK will do well to realize that they won't be getting Human Genome on the cheap."
“The rights plan will not prevent any offers or transactions that the board determines to be in the best interest of HGS and its stockholders,” the company said today in a separate statement. "The board believes that GSK acted to take advantage of the company's depressed stock price levels."
Now that the deal is close to finalized, the $14.25-per-share price values Human Genome at about $3.6 billion, according to MarketWatch. GlaxoSmithKline will get full ownership of the Benlysta, albiglutide and darapladip drugs.
"After a thorough analysis of strategic alternatives, HGSI has determined that a combination with GSK is the best course of action for our company and the best way to maximize value for our stockholders," said H. Thomas Watkins, CEO of Human Genome Sciences.
On Tuesday morning, GlaxoSmithKline traded at about $45.30, up roughly 0.7 percent. Human Genome Sciences traded at about $14.20, up roughly 4.5 percent.
Follow me @BCallwood.
(c) 2013 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.