23rd Apr 2007 07:02
AstraZeneca PLC23 April 2007 (NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO ORFROM AUSTRALIA, CANADA OR JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO WOULDCONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION) 23rd April 2007 AstraZeneca to acquire MedImmune for $58 per share in a fully recommended, all-cash transaction with a total enterprise value of $15.2 billion Acquisition delivers AstraZeneca biologics ambition faster Creates a leading, fully-integrated biotechnology business within AstraZeneca with critical mass in research, development, regulatory and manufacturing with global sales reach Significantly expands product pipeline by adding 45 projects including 2 late-stage products and a blockbuster marketed monoclonal antibody, Synagis Summary AstraZeneca PLC ("AstraZeneca") today announced that it has entered into adefinitive agreement to acquire MedImmune, Inc. ("MedImmune"), in an all-cashtransaction. Under the terms of the agreement, which has unanimous MedImmuneBoard support, AstraZeneca will acquire all of the fully diluted shares ofMedImmune common stock at a price of $58 per share, for a total consideration ofapproximately $15.6 billion (including approximately $340m net cash). The acquisition of MedImmune significantly accelerates AstraZeneca's biologicsstrategy. The combination of MedImmune with AstraZeneca's wholly-ownedsubsidiary Cambridge Antibody Technology ("CAT") will create a world-class,fully integrated biologics and vaccines business within the AstraZeneca Groupwith critical mass in research, development, regulatory, manufacturing andglobal sales and marketing reach. MedImmune is a world-leading, profitable, biotechnology company with a record ofproven success with revenue in 2006 of $1.3bn, profit before tax of $75m andgross assets of $3.0bn. The acquisition extends AstraZeneca's R&D science base to allow it to addressnovel drug targets through 3 key technological approaches: small molecules,biologics and, for the first time, vaccines. Overall, the combination of MedImmune with AstraZeneca's existing capabilitieswill be capable of delivering a greater number of new biologic products to bringbenefit to patients in AstraZeneca's prioritised disease areas. The deal is expected to close in June 2007. Highlights and acquisition benefits R&D capability • Expands and diversifies AstraZeneca's science base by establishing an international platform capable of delivering a greater flow of new medicines in AstraZeneca's prioritised disease areas, embracing small molecules, monoclonal antibodies, next generation biologics and vaccines • Natural fit between CAT and MedImmune • Complementary with existing AstraZeneca therapeutic area strengths in Oncology, Infection and Respiratory & Inflammation • Provides entry into vaccines; through proprietary live attenuated vaccines capability • Brings significant regulatory experience in making Biologics License Applications • Enhanced biologics capability positions AstraZeneca as a more compelling licensing partner, improving AstraZeneca's externalisation position Manufacturing • MedImmune is a leader in protein engineering and biologics manufacturing, with a production capacity of over 30,000L planned by 2010 and world leading cell line productivity levels. Through further modest investment, capacity could be increased to over 60,000L. This would secure production requirements for the long-term and avoid the need for major near-term 'green-field' manufacturing investment by AstraZeneca to support its biologics strategy Pipeline • Adds 2 late-stage assets: the next generation follow-on to 'Synagis', 'Numax' and refrigerated formulation 'FluMist' with an anticipated US launch for 2007-2008 influenza season • Increases the proportion of biologics in AstraZeneca's pipeline from 7 percent to 27 percent and enlarges the total pipeline by 45 projects to 163 projects • Diversifies and expands R&D capability to deliver a greater flow of new biologic products Financial benefits • Synergies from the acquisition of MedImmune and from related AstraZeneca activities are expected to be towards $500m per annum by 2009 • The acquisition is expected to be cash earnings enhancing in 2009 • The acquisition will be fully funded in cash, bringing improved financial efficiency through balance sheet leverage. Previously announced $4bn share buyback programme for 2007 unchanged • Addition of attractive marketed products including 'Synagis' and 'FluMist' to AstraZeneca's portfolio adds $1.2bn in sales. Consensus sales growth for this portfolio is forecast at 12% CAGR to 2010 • Provides AstraZeneca with several other substantial assets, including a royalty stream on the sales of the HPV vaccines with estimated consensus peak sales of $5.5bn, potential milestones and royalties on MedImmune's other licensed products and $1.5bn cash, including $89.4m relating to MedImmune Ventures investments at book value People • Strong desire to retain employees and maintain culture, with emphasis on retaining key talent and critical skills • One-time retention grant for employees • David M. Mott, the Chief Executive Officer and President of MedImmune, and James F. Young, Ph.D., the President, Research and Development of MedImmune, have committed to remain with MedImmune and it is expected that other members of MedImmune's senior management will stay with the company following the closing • David M. Mott will take a leadership role within AstraZeneca Commenting on the Offer, David Brennan, Chief Executive Officer of AstraZeneca,said: "This acquisition represents a transformational step to deliver our biologicsstrategy sooner than anticipated. It creates a leading fully integratedbiologics and vaccines business with critical mass and enhances AstraZeneca's R&D science base through which we will deliver a stronger product pipeline. MedImmune adds an exciting existing pipeline, including 2 late-stage products,great expertise in biologic drug development and state of the art manufacturingfacilities. We look forward to welcoming MedImmune's employees into AstraZeneca and areexcited by the potential to create significant value for all our shareholders,employees and patients that this acquisition brings." David M. Mott, CEO and President of MedImmune, said: "After conducting a full and open process, whereby we evaluated potentialinterest in the value we have built over our 19 year history, we are verypleased to become a part of AstraZeneca. We believe that this transaction is inthe best interest of all parties, including shareholders, employees andultimately patients. The potential to harness the combined skills andcapabilities of MedImmune, AstraZeneca and CAT and take our combined world classbiologics capabilities to the next level, is very exciting and a challenge towhich I am personally committed." The Transaction The acquisition is structured as an all cash tender offer for all outstandingshares of MedImmune common stock followed by a merger in which each remaininguntendered share of MedImmune would be converted into the same $58 cash pershare price paid in the tender offer. The acquisition is subject to thesatisfaction of customary conditions, including the tender of a majority of theoutstanding MedImmune shares on a fully-diluted basis and the expiration orearlier termination of the Hart-Scott-Rodino waiting period and other regulatoryapprovals. The tender offer will be commenced within 10 working days and isexpected to close in June 2007, unless extended. The tender offer is not subjectto a financing contingency. The acquisition price represents a premium of approximately 53.3% to MedImmune'sclosing share price of $37.84 on 11th April, 2007, this being the last businessday prior to MedImmune's announcement to explore strategic alternatives. The transaction has been unanimously recommended by the Board of Directors ofMedImmune. The acquisition will be effected pursuant to a merger agreement. The mergeragreement contains certain termination rights for each of AstraZeneca andMedImmune and further provides that, upon termination of the merger agreementunder specified circumstances, MedImmune may be required to pay AstraZeneca atermination fee of $450 million. Financing The total consideration for the acquisition of MedImmune amounts toapproximately $15 billion in cash. AstraZeneca will draw from a committedbanking facility in the amount of $15 billion to provide the initial financingfor the acquisition. Additional Information The tender offer described in this press release has not yet commenced, and thispress release is neither an offer to purchase nor a solicitation of an offer tosell MedImmune common stock. Investors and security holders are urged to readboth the tender offer statement and the solicitation/recommendation statementregarding the tender offer described in this press release when they becomeavailable because they will contain important information. The tender offerstatement will be filed by AstraZeneca and a subsidiary of AstraZeneca with theSecurities and Exchange Commission ("SEC"), and the solicitation/recommendationstatement will be filed by MedImmune with the SEC. Investors and securityholders may obtain a free copy of these statements (when available) and otherdocuments filed by AstraZeneca or MedImmune with the SEC at the websitemaintained by the SEC at www.sec.gov. The tender offer statement and relatedmaterials may be obtained for free by directing such requests to AstraZeneca(Investor Relations) at +44 (0) 207 304 5000. The solicitation/recommendationstatement and such other documents may be obtained by directing such requests toMedImmune (Investor Relations) at 301-398-4358. Enquiries: AstraZeneca Media Enquiries: Steve Brown / Edel McCaffrey (London) (020) 7304 5033/5034 Staffan Ternby (Sweden) (8) 553 26107 Emily Denney (Wilmington) (302) 885 3451 Analyst/Investor Enquiries: Jonathan Hunt / Mina Blair / Karl Hard (London) (020) 7304 5087/5084/5322 Staffan Ternby (Sweden) (8) 553 26107 Ed Seage / Jorgen Winroth (US) (302) 886 4065/(212) 579 0506 Merrill Lynch (Financial Adviser to AstraZeneca) +44 (0) 20 7628 1000 Richard Girling Deutsche Bank (Joint Corporate Broker to AstraZeneca) +44 (0) 20 7545 8000 Charlie Foreman Goldman Sachs (Joint Corporate Broker to AstraZeneca) +44 (0) 20 7774 1000 Phil Raper MedImmune Media Enquiries: Lori Weiman 240-372-4829 Jamie Lacey 301-398-4035 Analyst/Investor Enquiries: Pete Vozzo 301-398-4358 AstraZeneca will be holding an analyst presentation by webcast andteleconference as follows: Presentation The presentation will be available 15 minutes prior to the start of theanalysts' teleconference/webcast. Audio webcast The webcast will start at 11:30 BST. Teleconference details 11:30 BST, 12:30 CEST, 06:30 EDT There will be an interactive Q&A session UK freephone 0800 559 3272 US freephone +1 886 239 0753 Sweden freephone 0200 887 737 International +44 (0)207 138 0815 Journalists are invited to listen only on +44 (0)207 138 0810 A replay facility will be available from 15.30 BST on 23rd April 2007 UK freephone 0800 559 3271 US freephone +1 866 239 0765 Sweden freephone 0200 887 740 International +44 (0)207 806 1970 Replay passcode 1880494# Not for release, publication or distribution, in whole or in part, in, into orfrom Australia, Canada or Japan This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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