GSK stretches $2.6B offer for HGS

GlaxoSmithKline ($GSK) hasn't budged on its $2.6 billion offer for Human Genome Sciences ($HGSI). The London-based drug giant lengthened its offer to HGS shareholder at the same $13-per-share price tag, holding less than 1% of the shares when the previous offer period expired Thursday, Reuters' Ben Hirschler reported. 

The biotech yanks have shunned GSK's hostile bid, maintaining that the offer undervalues the company, while the British pharma notes that the sum is an 81% premium on the price of the stock before the buyout plan was announced in April. While the extended offer from GSK lasts through June 29, sources tell Reuters that the company plans to outflank HGS by replacing the entire board of the Rockville, MD-based biotech via a "consent solicitation."

Meantime, HGS has advanced a poison pill strategy to stymie GSK's advance and buy time to attract competing buyout bids. As Hirschler reported, HGS has been in talks with other companies but no other bids have surfaced. Why? Glaxo already controls half of the commercial value of HGS's lupus drug Benlysta as well as most of the potential bounty from sales of key drugs in the biotech's pipeline. That could make HGS less attractive to a buyer which would have to share revenue from those products with GSK.

- here's GSK's release
- read the Reuters' article