(Reuters) – Alexion Pharmaceuticals Inc (ALXN.O) said on Friday its board of directors had unanimously decided against hedge fund Elliott Management’s push for a “proactive sale” process, as it would not be in the best interest of shareholders.
Alexion, which has a market capitalization of about $24 billion, said it took into account the hedge fund’s views but concluded it was “highly unusual, if not unprecedented” for a company of its size to proactively launch a sale process.
“To eliminate confusion and inaccurate information in the marketplace, to-date, Alexion has not received any indications of interest to acquire the company nor have we rejected any such inbound proposals,” the company said.
The most notable part of the announcement is that Alexion has not received any indications of takeover interest, Stifel analyst Paul Matteis said.
“Putting this in context, a component of the Alexion investor bull case is the potential for M&A.”
Still, shares of the U.S. drugmaker rose 3.5% to $111.17 in early trading.
“Shares are rising because this issue between Alexion and Elliott might flush out prospective buyers,” Oppenheimer & Co analyst Hartaj Singh said.
“There has been frustration among Alexion shareholders about share price performance.”
Elliott has been pushing for more actions from the company to boost the company’s stock price. Up to Thursday’s close, the shares had risen about 10% this year, underperforming the more than 20% gain in the Nasdaq biotechnology index .NBI.
Alexion said on Friday that since 2017, it had added five new directors with inputs from investors including Elliott.
The company has been fighting to maintain its leadership in treating certain rare blood disorders and has embarked on a string of acquisitions to boost its pipeline of rare disease drugs. It is targeting at least 10 additional launches by 2023.
With U.S. market exclusivity for its best-selling drug Soliris under threat, the firm has been pushing to convert patients to its newer successor drug Ultomiris and add more approvals to the drug’s label.
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Home » Analysis & Comment » Alexion Pharma rejects Elliott's push for 'proactive sale'
Alexion Pharma rejects Elliott's push for 'proactive sale'
(Reuters) – Alexion Pharmaceuticals Inc (ALXN.O) said on Friday its board of directors had unanimously decided against hedge fund Elliott Management’s push for a “proactive sale” process, as it would not be in the best interest of shareholders.
Alexion, which has a market capitalization of about $24 billion, said it took into account the hedge fund’s views but concluded it was “highly unusual, if not unprecedented” for a company of its size to proactively launch a sale process.
“To eliminate confusion and inaccurate information in the marketplace, to-date, Alexion has not received any indications of interest to acquire the company nor have we rejected any such inbound proposals,” the company said.
The most notable part of the announcement is that Alexion has not received any indications of takeover interest, Stifel analyst Paul Matteis said.
“Putting this in context, a component of the Alexion investor bull case is the potential for M&A.”
Still, shares of the U.S. drugmaker rose 3.5% to $111.17 in early trading.
“Shares are rising because this issue between Alexion and Elliott might flush out prospective buyers,” Oppenheimer & Co analyst Hartaj Singh said.
“There has been frustration among Alexion shareholders about share price performance.”
Elliott has been pushing for more actions from the company to boost the company’s stock price. Up to Thursday’s close, the shares had risen about 10% this year, underperforming the more than 20% gain in the Nasdaq biotechnology index .NBI.
Alexion said on Friday that since 2017, it had added five new directors with inputs from investors including Elliott.
The company has been fighting to maintain its leadership in treating certain rare blood disorders and has embarked on a string of acquisitions to boost its pipeline of rare disease drugs. It is targeting at least 10 additional launches by 2023.
With U.S. market exclusivity for its best-selling drug Soliris under threat, the firm has been pushing to convert patients to its newer successor drug Ultomiris and add more approvals to the drug’s label.
Source: Read Full Article