Actelion's ambitious independent-minded CEO will drive up takeover price

Mon Nov 28, 2016 7:40am EST
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By John Miller

ZURICH (Reuters) - Actelion Chief Executive Jean-Paul Clozel's desire to keep Europe's biggest biotech company independent after building it from scratch, means Johnson & Johnson will have to pay a steep premium if a takeover is to succeed.

The U.S. healthcare titan on Friday confirmed talks with the Swiss maker of medicines for deadly pulmonary arterial hypertension (PAH). While Actelion confirmed the courtship, it said there was no guarantee of a deal.

Actelion's rare-disease focus makes it an attractive target, since its drugs face less price pressure than other more widely used medicines.

Analysts estimate a deal could be as high as 250 Swiss francs ($247) per share, valuing Actelion at around $26 billion, or $6 billion more than its current price even after the share's 17 percent surge on Friday.

Having fended off reported approaches by Shire in 2015 and hedge fund Elliott Advisors in 2011, Clozel, a French-born cardiologist, has repeatedly asserted his desire to go it alone, with his three main PAH drugs and with pipeline medicines he hopes will create a broad-based biotech company.

This hard-to-get approach, coupled with the high value of recent deals in the sector, will drive up Actelion's takeover price, analysts said.

"Similar deals have been at a 40-plus percent premium and we view 240 Swiss francs as a possible floor takeout value," Jefferies analyst Peter Welford said.

Analysts at Bryan Garnier suggested a bid price of up to 250 francs.   Continued...

A general view shows Swiss biotech group Actelion Headquarters in Allschwil, Switzerland, February 17, 2015.    REUTERS/Arnd Wiegmann/File Photo