Did monkey wrench or due diligence delay the Sanofi-Genzyme deal?

Sanofi-Aventis and Genzyme aren't quite as close to a takeover deal as the insiders have been signaling in recent days. Just about every major financial news service has shouted out that Sanofi will pay a $74 per share price for the big biotech, with a contingent value right security that would start trading at around $2-$3 with the potential to hit $5 or $6, depending on the market success of the MS drug Lemtrada. Ink would be applied to paper in a matter of days or hours, right?


When Sanofi CEO Chris Viehbacher (photo) sat down with The New York Times yesterday, he didn't sound at all committed to such a short and snappy timeline. After slowly wrapping its arms around Genzyme following a six-month standoff--and only recently putting its hands on the biotech's books--Sanofi plans to take its time before finalizing a deal. And pushing past the latest deadline of February 15 seemed well within the realm of possibility.

"We are making good progress, and the evidence of that is, we've been able to sign a confidentiality agreement and are starting to share nonpublic information," Viehbacher told The New York Times. "But this is a company that's present in 80 markets and has 14 manufacturing facilities, so getting through due diligence needs the appropriate amount of time to do that."

The sudden news vacuum that descended after the flurry of excited deal pronouncements had at least one observer wondering if there could be more to the unexpected delay than a commitment to thorough due diligence.

Both companies clearly need each other, writes the Wall Street Journal's Mimosa Spencer. "So you can't help wondering if, in the past two weeks since Sanofi has had access to Genzyme's books, an unexpected discovery has thrown a wrench into negotiations."

- see the NYT story
- and here's the WSJ column