Genzyme acquired by Sanofi

Genzyme, which employs 500 people at its Waterford base, is to be acquired by pharmaceutical giant Sanofi-Aventis for close to $20 billion.

Under the deal Sanofi-Aventis is to acquire Genzyme for $74.00 in cash per share plus a tradable contingent value right, or CVR, based on the performance of experimental multiple sclerosis drug Lemtrada and production volumes of two other medicines.

The biotech company, which established its Irish operations in 2001, employs 500 people on its 37 acre site in Waterford.

Seven Genzyme products, including Tkidney transplant rejection product Thymoglobulin, are produced in Waterford, and shipped to patients in more than 60 countries worldwide.

Pretax profits at the group's Waterford operations increased to €26.6 million in 2009.

The Irish arm of the global biotechnology company reported revenues of €788.8 million for 2009, a figure which accounted for 23.5 per cent of Genzyme's global turnover at today's exchange rates. Turnover at the Irish unit was down 11 per cent on the €889.6 million recorded in 2008.

The Genzyme site in Waterford was one of two sites in Ireland deemed to be of 'vital interest' to the US according to documents released by Wikileaks.

Shares in Sanofi rose 3.3 per cent in early trade as investors welcomed the boost to earnings the deal
would deliver.

The acquisition is the second-biggest in biotech history and will help Sanofi compensate for declining revenue from drugs that have lost, or are set to lose, patent protection.

Sanofi also predicted the deal, which is expected to close early in the second quarter, would lift its
underlying, or "business" earnings by 0.75 to 1.0 euro per share by 2013.

The $20.1 billion cash sum is based on 272.5 million Genzyme shares on a diluted basis.

The CVR runs until the end of 2020 and entitles holders to a series of payments worth up to $14 in total, depending mainly on the success of Lemtrada.

Additional reporting: Reuters