France's Sanofi-Synthelabo has made a hostile €48 billion bid for larger rival Aventis in a move to create one of world's top three pharmaceutical firms.
France's second-largest drugmaker is offering five of its shares for six Aventis shares plus €69 in cash. It said today that 81 per cent of the offer was in shares and 19 per cent cash.
Sanofi is also offering an alternative bid of 35 of its shares for 34 Aventis shares, equal to €60.43 per share, compared with the Aventis closing price on Friday of €57.55.
The principal stock-and-cash offer is worth €47.8 billion, a 3.6 per cent premium over Friday's closing price for Aventis but a 15.2 per cent premium over the average share price in the past month. The alternative offer is worth €48.5 billion.
The decision to launch a bid follows weeks of merger speculation, which drove shares in both companies higher as investors welcomed the prospect of cutting costs, combining sales forces and pooling new drug pipelines.
If completed, the deal would create a French national pharmaceutical champion valued at more than $100 billion, vying for the number two spot with GlaxoSmithKline and behind global leader Pfizer.