US biotech drug developer rejects GSK takeover bid
ROCKVILLE, Maryland - Biotech drug developer Human Genome Sciences Inc. Thursday rejected an unsolicited $2.59 billion takeover offer from British drug maker GlaxoSmithKline PLC, saying its $13 per share in cash undervalues the company.
While rejecting the takeover bid, HGS did not rule out the possibility of a sale in future.
In a statement, HGS revealed plans to explore strategic options, which could include a potential sale of the company. It invited GlaxoSmithKline to participate in its exploratory process.
As part of the process, the company said it has "requested additional information regarding investigational products in GSK's clinical pipeline to which HGS has substantial financial rights, including darapladib, currently in Phase 3 development for the treatment of cardiovascular disease, and albiglutide, currently in Phase 3 development for the treatment of type 2 diabetes."
Clarifying that there is no assurance that any transaction will occur or if so on what terms, HGS has declined to discuss the status of its evaluation "unless and until a specific transaction has been approved".
The UK based GSK offer of $13 per share is an 81 per cent premium to HGS closing price of $7.17 per share on Wednesday. HGS currently has about 199.1 million outstanding shares, according to FactSet.
Shares of HGS jumped $6.73, or 93.9 per cent, to $13.90 in premarket trading, while GSK's stock added 71 cents to $47.08.
GlaxoSmithKline is HGS' partner on the lupus drug Benlysta. Speculation has swirled since October that GlaxoSmithKline may try to buy Human Genome.
HGS announced that in the best interests of shareholders Goldman, Sachs Co. and Credit Suisse Securities (USA) LLC were being retained to assist in the process of studying strategic options, including possible sale.
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