Buzz: Sobi spurns Pfizer's rumored $5B buyout deal

Sobi CEO Geoffrey McDonough

Sobi has stepped away from the bargaining table without completing a rumored $5 billion deal to sell the company.

In a terse release, the Swedish-American hybrid--which has a CEO based in the Boston area and a headquarters facility in Stockholm--told investors that the company had terminated takeover talks. Sobi never officially identified the interested party, but Reuters reported that an acquisitive Pfizer ($PFE) had broached a deal. The wire service added today that the company--officially known as Swedish Orphan Biovitrum (STO: SOB)--felt it never heard a buyout offer worth a serious review by the board.

"Sobi will continue to focus on preparations for the upcoming planned launch of Elocta and Alprolix and on building value through its diverse and growing portfolio," the company said in a statement.

Sobi had a market value of about $3.5 billion when the bid rumors started to circulate. That valuation helped analysts to conclude that in today's heated M&A environment a successful offer would need to be within the upscale neighborhood of $5 billion.

Publicly ending takeover talks, though, won't be enough to take Sobi off the long list of potential biotech acquisitions, even if it wanted off. Closely partnered with Pfizer as well as Biogen ($BIIB), another company that has been frequently tied to takeover rumors, Sobi would make an easy bolt-on for a Big Biopharma company looking to expand in rare diseases. Also, the company retained Goldman Sachs to evaluate offers and has been chatting up investors about a buyout deal for months--not exactly the profile of a company that wants to stay independent.

Investors, though, were put off by the chill today, driving down Sobi's swollen share price by 16%.

Sobi reported back in late April that it had received a "preliminary and conditional non-binding" buyout proposal.

Geoffrey McDonough was brought in to run Sobi in 2011 after a stint at Genzyme, another rare-disease biotech. He was trained in Boston and returned there last fall, when the company opened an office in Waltham, MA.

- here's the report from Reuters

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