Sanofi bought the stocks in 2004, and it owns approximately 23.2 million shares, which means 20.6% of Regeneron. The latter itself wants to repurchase its shares worth $5 billion. The overall value is $13 billion. The decision came shortly after Regeneron stocks reached an increase of 57% in the past six months.
Goldman Sachs and Bank of America will be the underwriters of the transaction, which will comprise of $3.5 billion in cash and $1.5 billion from Goldman itself.
If Sanofi manages to sell its stake in the company, it will be the most significant public offering in the health-care industry ever made. The money Sanofi will get from the transaction will go to "further our ability to execute on our strategy to drive innovation and growth" as the company wants to expand its research in oncology.
According to the companies, their partnership won’t stop as they have drugs in development.
The move made by Sanofi backs-up the rumor that it might repurchase a 9.4% stake in L’Oreal SA. By extension, it means that L’Oreal could buy back the 23% stake that Nestle owns from it.
Regeneron stock price lost 5% in pre-market trading. Sanofi dropped by 1%.
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Sources: reuters.com, yahoo.com, seekingalpha.com