INDIANAPOLIS (AP) — A Jefferies & Co. analyst raised her price target Thursday for shares of Genzyme Corp., citing media reports that French drugmaker Sanofi-Aventis SA will make an offer to buy the biotechnology drugmaker.
Analyst Eun K. Yang set a new price target at $80, picking the midpoint between the $75-per-share price at which the analyst believes Genzyme would be interested in starting acquisition talks and the $85 sale price it may want. The previous price target was $63.
“In anticipation of the formal offer and price negotiation, we expect (Genzyme) shares will likely continue to trade up,” Yang wrote.
Genzyme shares started climbing earlier this month from about $50 after reports surfaced that Sanofi was interested in an acquisition.
Genzyme, which is based in Cambridge, Mass., has been struggling for months with manufacturing problems that reduced production of two key drugs for genetic diseases, Cerezyme and Fabrazyme. It said last week its profit shrank drastically in the second quarter because of falling sales and charges partly connected to those problems.
Yang said in her note the $85-per-share price reflects the company’s “turnaround value.”
The New York Times reported late Wednesday Sanofi likely will make an offer of up to $70 per share, or more than $18 billion total, for Genzyme, citing anonymous sources.
Sanofi CEO Christopher Viehbacher declined to comment Thursday on the takeover bid reports. He said the company was under no pressure to do any deals.
Sanofi, which is based in Paris, said Thursday its net income rose 61 percent to 1.7 billion euros ($2.2 billion) in the second quarter.
In premarket trading, Genzyme shares changed hands at $71.97, up nearly 6 percent from Wednesday’s close.
