Astellas makes $3.5B hostile bid for OSI

Astellas Pharma announced today that it has made a $3.5 billion hostile bid to acquire OSI Pharmaceuticals, which is developing molecular targeted therapies for oncology, diabetes and obesity.

The all-cash offer is a 40 percent premium over the closing price of OSI's common stock of $37.02 per share on February 26, and a 53 percent premium to its three-month average of $34.01 per share. Astellas, which says in a letter that it's tried to engage OSI in discussions for the past 13 months, believes the acquisition will help it become an oncology leader, as well as boost its urology and immunology business. OSI sells Tarceva, a drug approved for second-line use in lung cancer patients and for pancreatic cancer treatment.

"As recently as February 12, 2010, Astellas presented this proposal to acquire OSI, which reflected a 50 percent premium on that date," says Astellas CEO Masafumi Nogimori in a release. "However, we received a response stating that our offer 'very significantly undervalues' OSI. That response was the latest indication to us that OSI is not interested in engaging in substantive discussions. We are therefore taking our offer directly to OSI's stockholders."

Roche is partnered with OSI on Tarceva, and could represent a possible competitor for Astellas. Last year, the Japanese company also tried to buy CV Therapeutics for $1.1 billion. However, it eventually lost the developer to Gilead when the biotech sweetened the bid to $1.4 billion.

- read Astellas' release on the move
- here's the Bloomberg report

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