Japanese pharmaceutical company Astellas Pharma Inc. (ALPMY.PK: News , ALPMF.PK: News ) Monday said it offered to commence a tender offer to acquire all outstanding shares of common stock of OSI Pharmaceuticals (OSIP: News ) for US$52 per share, or about US$3.5 billion in an all-cash deal. According to Astellas, the offer represents a premium of over 40% on the closing price of US$37.02 per share of OSI's common stock on February 26.
OSI is a biotechnology company primarily focused on the discovery, development and commercialization of molecular targeted therapies targeting oncology, diabetes and obesity. OSI manufactures and sells Tarceva, a cancer medication and has several prospective new oncology medications in its R&D pipeline. Tarceva is approved for treating non-small cell lung cancer patients whose cancer has spread despite chemotherapy. It is co-marketed by OSI and Roche Holding AG (RHHBY.PK).
Astellas said it is taking the offer directly to OSI's stockholders as it realized after repeated attempts in the past 13 months that OSI is not interested in engaging in substantive discussions. Astellas sent a letter to OSI's Chief Executive Officer Colin Goddard this morning detailing the offer.
During a meeting with OSI's CEO in January 2009, Astella first raised its interst in acquiring OSI. The first written proposal was made in February 2009. Several other letters and face-to-face meetings followed, including a meeting between the two CEOs on February 12.
The offer made on February 12 to acquire OSI reflected a 50% premium on that date. However, OSI said the offer 'very significantly undervalues' it.
Astellas said today it would consider all means necessary to secure a completed transaction and intends to nominate directors at OSI's upcoming annual meeting to give stockholders a voice in the outcome.
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