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Pharmaceutical industry

Health Care Stocks Surge Amid Sanofi-Aventis' Pursuit of Genzyme

Strategic Insights

— 1 min read

In mid-day trading on December 13, 2010, health care stocks saw a significant surge as Sanofi-Aventis (SNY) extended its deadline for its hostile bid of Genzyme (GENZ). The Dow Jones U.S. Health Care Index rose 0.38, or 0.12%, to 325.25, with notable gains in individual stocks like Pfizer (PFE) and Merck (MRK). The Health Care Select Sector SPDR ETF (XLV) also traded higher, up 0.26% to $31.37. Meanwhile, Thermo Fisher Scientific Inc. (TMO) announced plans to acquire Dionex Corp. (DNEX) for $2.1 billion in cash, sending Dionex shares soaring.

Key Takeaways:

  • Sanofi-Aventis' extended deadline for its bid for Genzyme has led to a surge in health care stocks, with Genzyme shares up 0.66% to $70.28.
  • The Dow Jones U.S. Health Care Index rose 0.38, or 0.12%, to 325.25, driven by gains in multiple stocks including Pfizer (PFE) and Merck (MRK).
  • Thermo Fisher Scientific Inc. (TMO) plans to acquire Dionex Corp. (DNEX) for $2.1 billion in cash, with Dionex shareholders receiving $118.50 per share, a 32% premium over the company's average price over the last 60 trading days.
  • The acquisition is expected to be finalized in the first quarter of next year, with Thermo Fisher citing Dionex's presence in China as a key factor in the decision.
  • The deal is part of a broader trend of consolidation in the health care sector, with large companies swooping up smaller players to expand their portfolios.

Statistics:

  • Dow Jones U.S. Health Care Index rose 0.38, or 0.12%, to 325.25.
  • Sanofi-Aventis ADRs are up 0.24%, or $0.08, to $32.79.
  • Genzyme shares are up 0.66%, or $0.46, to $70.28.
  • Thermo Fisher shares are up 3.5%, or $1.86, to $54.90.
  • Dionex shares are up 20.25% to $118.05.
  • The total value of the Thermo Fisher-Dionex acquisition is $2.1 billion in cash.

Sources:

  • MidnightTrader.com (2010) - Dow Jones U.S. Health Care Index rises 0.38, or 0.12%, to 325.25.
  • Comtex News Network, Inc. (2010) - SmarTrend Alert: UPTREND on 09-07-2010 for DNEX @ $76.88.
  • Comtex News Network, Inc. (2010) - SmarTrend Alert: UPTREND on 07-23-2010 for GENZ @ $60.20.
  • Comtex News Network, Inc. (2010) - SmarTrend Alert: DOWNTREND on 11-12-2010 for SNY @ $33.97.

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