Bidding War Continues for AnorMED's Stem Cell Drug

Includes: ANOR, MLNM, SNY
by: H.S. Ayoub

Canadian biotech darling AnorMED (Nasdaq: ANOR) is the cause of a financial fight between two jealous suitors who are after its late stage stem cell drug MOZOBIL for cancer.

The company has rejected a tender offer from Genzyme (GENZ) for more than $12 a share, and has reiterated its recommendation to its shareholders to accept the $12 offer from Millenium Pharmaceuticals (MLNM).

This is Genzyme's second offer, as it dangled $8.55 a share earlier, but AnorMED's board was not biting.

Genzyme's second offer is not final however. The company still has to review AnorMED's non-public data and other information. So the offer could be raised.

This is a surprising development, since many thought Millenium was offering too much. But even with Genzyme's large market cap and cash holdings, Millenium is in a better financial position to afford this takeover.

Millenium has over $600 million in cash and only about $170 million in debt. Genzyme on the other hand owes more than it holds in cash.