In search of potential buyers, Human Genome Sciences ($HGSI) made another appeal to the only company that has emerged with an offer, GlaxoSmithKline ($GSK), asking the London-based drug giant yet again to join a bidding process that GSK has previously rejected amid its hostile move to acquire the U.S. biotech. GSK quickly snubbed the invitation.
Rockville, MD-based HGS said it had set a deadline of July 16 for all groups interested in buying the company to submit acquisition offers. In a letter sent to GSK on Thursday, HGS asked the British drug giant to take part in its review process for interested buyers under the rules established for all bidders. The letter follows GSK's decision last week to extend its $13-per-share offer to acquire HGS to June 29.
GSK isn't taking the bait. In a statement released after HGS's, the drug major said: "GSK continues to believe that participation in the process is unnecessary given the company's offer is not conditioned on due diligence or financing and can be completed expeditiously. GSK knows HGS well based on a 20-year relationship and is uniquely positioned to deliver on the opportunity of the combination. GSK has therefore today sent a letter to HGS declining again to participate in this process."
Despite a variety of moves from both HGS and GSK, neither company has succeeded in getting the other to capitulate to its demands. As Reuters reports, GSK picked up less than 1% of HGS' shares during its initial tender offer period that began after the HGS board rejected GSK's offer that valued the biotech at $2.6 billion as too poor. HGS hired Goldman Sachs and Credit Suisse to lead the search for buyers, but none have surfaced with a better offer than GSK's.
GSK has held its ground in the standoff with the understanding that the company already owns half the commercial rights to HGS's lupus drug Benlysta and most of the sales stake for experimental diabetes and heart disease drugs in HGS's pipeline. Bankers have told Reuters that other would-be buyers might be turned off by GSK's entrenched position in HGS's key programs.
- here's the release
- see Reuters' article
Editor's note: This story was updated with GSK's response.