Oxford GlycoSciences plc said it received a cash offer from Celltech Group plc to acquire OGS, but had "no hesitation in rejecting the offer."
"This inadequate cash offer is a spoiling tactic by Celltech," said OGS CEO David Ebsworth in a prepared statement. "It is clearly opportunistic and a bid to acquire OGS on the cheap."
OGS, of Oxford, UK, has been in talks with Cambridge Antibody Technology Group plc, of Melbourn, UK, for an all-share acquisition that valued OGS at £109.6 million (US$177 million). If that merger goes through, it would create a company with £260 million in cash and a market capitalization of about £289 million. (See BioWorld Today, Jan. 24, 2003.)
But the £101.4 million offer from Celltech now is more than OGS would get from CAT since CAT's stock has fallen since its bid was made.
OGS has said it has been approached by several potential merger partners and the company stated, "Any offer will be considered by the OGS board and assessed on its ability to create short-term as well as long-term value for OGS shareholders."
However, it was less than impressed with the offer from Celltech. OGS said the Celltech cash offer of 182 pence per share "wholly undervalues the business and cash of OGS. It denies OGS shareholders any opportunity to participate in the future value of OGS's research and development pipeline."
The offer, OGS said, is a 26 percent discount to OGS's cash per share, estimated at 245 pence as of Dec. 31. It also is a 7 percent discount to the closing price Tuesday, as well as being a 7 percent discount to the Cambridge Antibody Technology offer. Also, it's a low acquisition premium of only 19 percent to the OGS share price of 152.5 pence on Jan. 22, the day before the CAT offer was made public, OGS said.