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Reuters: Sanofi working with Lazard on $12.7B deal for animal health unit

Nov. 27, 2015 4:42 PM ETSanofi (SNY) StockSNYBy: Jason Aycock, SA News Editor6 Comments
  • Sanofi (NASDAQ:SNY) is up 1% after hours on news it's working with investment bank Lazard to prepare a sale or listing of Merial, its animal health unit, which could value the division up to €12B (about $12.7B), Reuters is reporting.
  • On an investor day Nov. 6, new chief Olivier Brandicourt discussed cost cuts and acquisitions, but hinted at strategic options for unloading Merial and its European generics business due to limited synergies.
  • Lazard has a close relationship with Sanofi via the drugmaker's chairman, Serge Weinberg. Sanofi may favor an IPO for the unit to avoid antitrust challenges in selling to a rival, sources told Reuters.
  • Merial has about 6,500 employees and expects to exceed €2.4B in sales this year.
  • The generics business is worth up to €3B, but any divestment faces a longer path with heavy legal disentanglement ahead, and wouldn't start until the second half of next year.

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