AstraZeneca PLC Will Bid for GlaxoSmithKline As Suitors Emerge: Poll

June 4, 2015
By Riley McDermid, BioSpace.com Breaking News Sr. Editor

Over a third of respondents in a recent poll conducted by BioSpace believe that AstraZeneca PLC could be in the running to acquire struggling GlaxoSmithKline , just a month after the market started buzzing that Pfizer Inc. should be the company.

The speculation surrounding a possible bid from Pfizer Inc. for Glaxo has been heating up, after one closely-watched biotech analyst said in a note recently that Pfizer buying the company would “unlock access to its balance sheet and improve its tax situation.”

Gregg Gilbert, a biotech analyst at Deutsche Bank , wrote in a note to investors “Introducing PfizerKline” that he thinks a deal would be “materially accretive” for both companies. Gilbert estimated that a bid priced at $29.86 a share, via half stock and half cash, which would push up Pfizer’s earnings per share by 10 percent to 16 percent beginning in 2016.

“We believe that the company has a sense of urgency to create value by leveraging the power of its balance sheet to do needle-moving deals,” Gilbert wrote. “Since media reports in the past have pointed to the potential for a Pfizer/GSK combination, we are revisiting that theme.”

Now, it seems that many in biotech now believe that deal is highly possible and that other marquee-name suitors could soon line up to get a piece of Glaxo if dealmaking is in the wind.

In a poll of 599 BioSpace community members, 35 percent said it was somewhat likely that Pfizer would bid for Glaxo, 32 percent it was very likely, 23 percent said not very likely, and 11 percent believed the bid just was “not happening.”

A further 65 percent said Glaxo would contest any bid made, while 35 percent said it would go quietly into that good night of M&A. Along those same lines, 56 percent said any takeover attempt by Pfizer for Glaxo would wind up hostile, while 44 percent said they believed it would be an amicable process.

For companies that would throw their hats in the ring, 33 percent said AstraZeneca would be the most likely suitor, followed by 26 percent for Johnson & Johnson , 23 percent for Merck & Co. and 18 percent backing Roche .

Still, it wasn’t entirely certain that other companies would want to take on the massive task of weaving Glaxo into their own corporate culture: 59 percent of respondents said they believed that if Glaxo was targeted by Pfizer, no other suitors were likely to emerge, while 41 percent said they thought other companies would likely make their own bids.

The majority of the respondents in this week’s poll were from the United States, with 78 percent of the 599 participants based in America. The rest hailed from a host of countries including Belgium, Germany, France, Canada, Switzerland, the United Kingdom, Taiwan, Finland, Turkey, Mexico, Japan, Ireland, Israel, Greece, India, the Netherlands and Singapore. Three percent of respondents declined to identify their country of domicile.

For states, New York led the pack, with 16 percent of the poll’s respondents based in that state. New Jersey followed with 14 percent, then California at 13 percent. The rest were distributed throughout the U.S.