UPDATE-Eli
Lilly raises offer for Icos to $2.3 billion
December 18, 2006
BOSTON, Dec 18 (Reuters) - Eli Lilly and Co.
said on Monday it has increased its offer for
biotechnology company Icos Corp to $2.3 billion
from $2.1 billion after at least one Icos shareholder
called the earlier bid too low.
The revised price of $34 a share follows objections
from HealthCor Management, a big Icos shareholder,
and advisory firms such as Institutional Shareholder
Services, to the earlier $32-a-share offer.
HealthCor argued that Icos was worth more than
$40 a share.
Spokespeople for ISS and HealthCor were not
immediately available for comment.
Lily, who agreed in October to acquire Icos
to gain full ownership of the erectile dysfunction
drug Cialis,
said its latest offer was its "best and
final offer."
"We are confident that Icos shareholders
will recognize the substantial value and the
certainty that Lilly is offering," Sidney
Taurel, Lilly's chief executive officer, said
in a statement.
Shares of Icos rose 47 cents, or 1.4 percent,
to $33.82 in mid-morning trading on NASDAQ.
Lilly's shares fell 79 cents, or 1.4 percent,
to $53.77 on the New York Stock Exchange.
Indianapolis-based Lilly, which currently
markets Cialis with Icos through a joint venture,
said the boards of both companies have unanimously
approved the new offer.
Lilly is eager to take advantage of a revival
in the erectile dysfunction market, which was
hurt last year by concerns that drugs to treat
the condition, including Pfizer Inc.'s Viagra,
could cause blindness.
Last week Icos said it expects sales of Cialis
to reach at least $1.1 billion next year. It
projected 2007 net income of between $52 million
and $63 million.
In an earlier report, ISS said that Lilly's
initial offer reflected the big drug maker’s
ability to limit deal discussions to the "my
way or the highway variety." ISS said the
Icos board was hamstrung by contractual limitations
imposed by the joint venture agreement.
Source:
http://today.reuters.com/news/articleinvesting.aspx?view=CN&storyID=2006-12-18T160140Z_01_N18468202_RTRIDST_0_ICOS-LILLY-UPDATE-2.XML&rpc=66&type=qcna
|
