Sanofi ready to up offer for Medivation

PARIS: France's Sanofi said it could raise its proposed $9.3 billion deal to buy Medivation if the U.S. cancer drugmaker engaged in talks, threatening to go directly to shareholders to oust the board if not.

Sanofi Chief Executive Olivier Brandicourt wrote in a letter to the board of Medivation published on Thursday that the transaction was a priority for the French drugmaker and it was committed to seeing it through.

San Francisco-based Medivation said on Thursday it had received a letter from Sanofi that "simply restates an inadequate proposal that... substantially undervalues the Company, its leading oncology franchise, and innovative late-stage pipeline".

Brandicourt said Sanofi had spoken to top Medivation shareholders and the proposal had "overwhelming" support.

"If you engage in good faith discussions with us and demonstrate additional value, we could be in a position to revise our offer," the CEO wrote. "If you are not prepared to engage with us, we have no choice but to go directly to your shareholders."

Sanofi said rules in the state of Delaware, where Medivation is registered, gave shareholders owning a majority of the company the power to oust the board.

"If the Medivation board of directors continues to refuse to engage with us, then we intend to commence a process to remove and replace members of the board," Brandicourt said.

In its quarterly earnings call on Wednesday, Medivation's Chief Executive Officer David Hung said that Medivation's major shareholders had been "very supportive" of the board's choice to reject Sanofi's bid.

He declined to comment on whether Medivation would run a sale process to explore offers from other potential bidders.

Sanofi went public with the takeover proposal on April 28, but Medivation rejected the $52.50-a-share deal outright, saying it undervalued the company "substantially". The stock has since risen to over $59.