Sanofi Acquires Genzyme in $20.1 Billion, Family Dollar in Play

Arthi Gupta
16 Feb, 2011
New York City

U.S. indexes rose after Dell net more than doubled. U.S. homebuilder confidence remained flat in February. Sanofi-Aventis acquired Genzyme in a $20.1 billion deal. Air Products withdrew its offer for Airgas. Borders Group filed for bankruptcy.

[R]8:10 AM New York – U.S. indexes rose after Dell net more than doubled. U.S. homebuilder confidence remained flat in February. Sanofi-Aventis acquired Genzyme in a $20.1 billion deal. Air Products withdrew its offer for Airgas. Borders Group filed for bankruptcy.[/R]

Asian and European markets traded higher on positive earnings.

U.S. Homebuilder Confidence Flat

Homebuilder confidence in the U.S. remained unchanged for the fourth consecutive month in February, according to a report released by the National Association of Home Builders on Tuesday.

The report showed that the NAHB/Wells Fargo Housing Market Index was at 16 in February, unchanged from January.

World Bank Food Price Index Rises

World food prices are at """"dangerous levels"""" and have driven an estimated 44 million people into poverty since last June, the World Bank said on Tuesday.

The lender''s food price index rose 15% between October and January to be 29% higher than its level in the same period a year earlier.

Sanofi-Aventis Acquires Genzyme

Sanofi-Aventis, the French pharmaceutical giant agreed to acquire U.S. biotechnology firm Genzyme Corp. for $74 per share in cash or about $20.1 billion. Following the combination, Genzyme would become Sanofi''s global center for excellence in rare diseases.

Under the deal, each Genzyme shareholder will get one Contingent Value Right for each share they own, entitling the holder to receive additional cash payments if specified milestones related to Lemtrada are achieved over time or a milestone related to production volumes in 2011 for Cerezyme and Fabrazyme is achieved.

Air Products Withdraws Offer for Airgas

Air Products & Chemicals has finally withdrawn its offer to acquire Airgas after the Delaware Chancery Court''s decision to uphold the Airgas administered poison pill.

Airgas maintains that Air Products'' offer is clearly inadequate and is intended only to transfer the value of Airgas to Air Products at a price that does not appropriately compensate its stockholders.

Family Dollar Confirms Offer from Trian Capital

Family Dollar Stores confirmed that it received an unsolicited conditional proposal from Nelson Peltz controlled Trian Group at a price in the range of $55 to $60 per share in cash, subject to due diligence, financing and other conditions.

CB Richard Purchases ING''s REIM Operations

CB Richard Ellis Group, Inc. agreed to acquire majority of the real estate investment management business of Dutch financial services company ING Group NV for about $940 million in cash.

Under the deal, the company will acquire substantially all of the ING REIM operations in Europe and Asia.

Caterpillar Plans to Sell Carter Machinery

Caterpillar Inc. said it agreed to sell Carter Machinery Company Inc. The terms of sale were not disclosed.

Carter Machinery is a Caterpillar dealership headquartered in Salem, Virginia, and has operations and stores covering Virginia and nine counties in southeast West Virginia.

Borders Group Files for Bankruptcy

Borders Group, Inc. said that, with the authorization of its board of directors, it filed a petition for reorganization relief under Chapter 11 of the Bankruptcy Code.

Borders said that it is serving customers in the normal course, including honoring its Borders Rewards program, gift cards and other customer programs. The company also expects to make employee payroll and continue its benefits programs for its employees.

Earnings Review

Analog Devices, Inc. ((ADI)), the IC chips maker stated first quarter revenue rose 21% to $728.50 million from $602.98 million last year. Net income in the quarter increased 84.4% to $222.11 million or 72 cents per diluted share compared to net income of $120.46 million or 40 cents per share in the previous year.

BHP Billiton Limited ((BHP)), the diversified natural resources company reported revenues for the first-half rose 39% to $34.17 billion from $24.58 billion in the same period last year.

Profit in the period surged 72% to $10.52 billion or $1.89 per share as against $6.02 billion or $1.10 per share in the same period last year, boosted by revenue growth across its customer sector groups amid increase in prices of core commodities and robust emerging market demand. Further, the company declared a 10% increase in interim dividend.

Deere & Company ((DE)), the farm and construction machinery maker reported first quarter worldwide net sales and revenues increased 26.4% to $6.12 billion from $4.84 billion last year. Net income in the quarter rose 111% to $513.7 million or $1.20 per diluted share compared to net income of $243.2 million or 57 cents per share last year.

Dell Inc. ((DELL)), the PC maker said fourth quarter revenue rose 5% to $15.69 billion from $14.90 billion in the same quarter last year, as commercial and enterprise sectors continue to be solid. Net income in the quarter surged 178% to $927 million or 48 cents per diluted share compared to net income of $334 million or 17 cents per share for the year-ago quarter.

Revenue for the fiscal year 2011 increased 16% to $61.49 billion from $52.90 billion the prior year. For the fiscal year 2011, the company reported net income of $2.64 billion or $1.35 per share, compared to $1.43 billion or $0.73 per share for the full year 2009.

Genzyme Corporation ((GENZ)), the biotechnology company stated fourth quarter total revenues improved 23% to $1.15 billion from $938 million prior year. Net income in the quarter surged 1934% to $471.9 million or $1.76 per share compared to net income of $23.2 million or 9 cents per share in the same period in 2009.

Rovi Corporation ((ROVI)), the digital technology company reported fourth quarter revenues rose 2.3% to $140.2 million from $137.1 million in the same quarter of last year. Net income in the quarter soared 2485% to $67.2 million or 59 cents per diluted share compared to net income of $2.6 million or 2 cents per share last year.

For the full year, revenues surged to $541.5 million from $480.5 million. Net income was $212.8 million or $1.94 per share versus a net loss of $52.9 million or $0.52 per share a year ago.

WellCare Health Plans, Inc. ((WCG)), the provider of Medicare and Medicaid managed care health plans stated fourth-quarter total revenues decreased 16% to $1.36 billion from $1.62 billion in the comparable period last year. Net income in the quarter grew 135% to $26.1 million or 61 cents per diluted share compared to net income of $11.1 million or 26 cents per share last year.