AstraZeneca Blocks Private Equity Buyout of Swedish Pharma Sobi

Swedish Orphan Biovitrum AB (Sobi), a Swedish drugmaker specializing in haematology, immunology products and specifically for rare diseases, lost a buyout deal due to strong opposition from one of their stakeholders, AstraZeneca. Advent International and Singapore-based investment fund GIC were in talks with SobI for a $7.6 billion takeover. However, AstraZeneca opposed the bid by withholding its 8% stake. 

Dubbed as possibly the largest take-private transaction in European healthcare in 2021, Advent and GIC offered a 34% premium on Sobi’s share price in late August. Expecting a capital requirement for many of their products in late-stage development, Sobi accepted the bid. The deal fell through since Sobi failed to reach the required approval from 90% of shareholders. Despite backing from top stakeholder Investor AB, who was willing to tender their 35% stake, AstraZeneca’s objection resulted in 87% approval. 

A Keen Stake in Sobi

AstraZeneca partnered with Sobi in 2018 to market Synagis, a drug for lower respiratory tract infections, in the US. Speculation is rife that private-equity ownership of Sobi may have transferred the rights for Synagis to a competitor. Another line of reasoning puts the focus on AstraZeneca’s interest in Sobi’s rare disease-related drugs. According to equity research analyst from Handelsbanken, Mattias Haggblom, AstraZeneca might be strapped for cash since their $39 billion takeover of Alexion Pharmaceuticals and may want to wait for a while before another acquisition. 

Sobi’s stock prices fell 23% on 3rd December 2021, following the failed bid. Chairman Håkan Björklund commented on the bid process and said, “As we have announced, the Board supported the public offer by Advent and GIC, as we believed in the strategic merit of the transaction. Subsequent discussions regarding the potential execution of the transaction have been directly dealt with between the bidding consortium and Sobi shareholders.”

Author

Sahana Shankar