Astellas Wins OSI But Victory Comes At A Price

Japanese drugmaker Astellas Pharma's painstaking pursuit of OSI Pharmaceuticals is officially over. The victory came at a price, however, costing $4 billion, about $500 million more than Astellas' original hostile bid, launched in late February. That Astellas and OSI managed to find a path forward isn't surprising. Both companies had too much at stake not to see the merger come to fruition.

Japanese drugmaker Astellas Pharma Inc.'s painstaking pursuit of OSI Pharmaceuticals LLC is officially over. On May 17, 2010 came news that the two companies had agreed to a definitive merger agreement, enjoying the unanimous support of both companies' boards. The victory came at a price, however, costing $4 billion, about $500 million more than Astellas' original hostile bid, launched in late February. [See Deal] As of June 8, more than 53 million shares—approximately 93% of OSI's issued and outstanding shares--had been validly tendered, allowing Astellas to proceed with the acquisition via Delaware's short-form merger process, which doesn't require approval from OSI shareholders.

That Astellas and OSI managed to find a path forward isn't surprising. Both companies had too much at stake not...

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