April 19, 2012 7:08 PM
Six Am Law Firms Land Roles on GSK’s $2.59 Billion Unsolicited Biotech Bid
Posted by Tom Huddleston Jr.
A host of Am Law firms have secured advisory roles in connection with British pharmaceutical giant GlaxoSmithKline’s unsolicited $2.59 billion bid to buy biotechnology outfit Human Genome Sciences.
London-based GSK confirmed Thursday that it has offered to purchase Human Genom for $13 in cash per share. GSK chief executive Sir Andrew Witty formally contacted Human Genome CEO Thomas Watkins on April 11 in a letter outlining the offer.
Rockville, Marylandâ€“based Humane Genome, meanwhile, released a statement Thursday in which the company’s board claimed the GSK offerâ€”which represents an 81 percent premium over the target company’s Wednesday closing priceâ€””does not reflect the value inherent” in Human Genome. The board added that it is exploring alternatives to GSK’s offer, and left the door open to to deal eventually getting done.
The companies have a history of collaboration, including the joint development of multiple drugs now in the Human Genome pipeline. Among those products are drugs aimed at treating heart disease and diabetes, as well as Benlystaâ€”a lupus treatment that received FDA approval last year.
The New York Times notes that GSK’s bid is likely an attempt to capitalize on a significant drop in Human Genomeâ€™s stock price, which has fallen nearly 75 percent in the past year after approaching $30 per share. The target company has reported losses of more than $600 million in the past two years combined as a result of marketing and administrative costs connected to Benlysta.
GSK said in its announcement it expects that acquiring Human Genome would produce cost savings of at least $200 million by 2015, and that the proposed deal would add to earnings by next year.
In his letter to Watkins, GSK CEO Witty revealed that his company has retained Cleary Gottlieb Steen Hamilton and Wachtell, Lipton, Rosen Katz as legal counsel on its unsolicited bid.
The New Yorkâ€“based Cleary team is being led by MA partner Victor Lewkow, corporate finance partner Benet O’Reilly, and litigation partner Meredith Kotler. GSK is a longtime Cleary client, with the firm having represented SmithKline Beecham in its 2000 merger with Glaxo Wellcomeâ€”a deal valued at roughly $76 billion.
For Wachtell, the representation signifies a bit of a switch, as the firmâ€”whose founding partner Martin Lipton invented the “poison pill” takeover defenseâ€”is tapped by target companies looking to fend off hostile acquisitions. New Yorkâ€“based corporate partners Adam Emmerich and David Lam are leading the
Wachtell team advising GSK.
Gibson, Dunn Crutcher corporate partners Dennis Friedman and Eduardo Gallardo are representing Lazard and Morgan Stanley in their roles as financial advisers to GSK.
Human Genome has engaged Skadden, Arps, Slate, Meagher Flom and DLA Piper as outside counsel in the process. The Skadden team is being led by Washington, D.C.â€“based MA partners Marc Gerber and Michael Rogan. A DLA Piper spokesman did not immediately respond to a request for further information on its role in the matter.
Fried, Frank, Harris, Shriver Jacobson corporate partners Philip Richter and Robert McLaughlin are advising Goldman Sachs in its role as a financial adviser to Human Genome
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