Credit Suisse: Medivation Worth $54 To $75 In Takeout, But Company Not Selling

After market close on March 30, news reports suggested that Medivation Inc MDVN had hired bankers to defend the company against acquisition.

Credit Suisse’s Kennen MacKay maintained an Outperform rating on the company, while raising the price target from $48 to $49.

Acquisition Analysis

MacKay mentioned that while the company had become an acquisition target following the pullback in its stock valuation, management did not appear to be interested in selling.

Following an acquisition scenario analysis of companies that have expressed interest in acquiring U.S. oncology firms, MacKay stated that Medivation could be worth $54-$59 in terms of operational synergies and $60-$75 with leveraged tax benefits

Potential Synergies

The analyst pointed out that Medivations product and pipeline portfolio would offer synergies for Sanofi SA (ADR) SNY, AstraZeneca plc (ADR) AZN and Roche Holding Ltd. ROG.

“However, given MDVN’s manufacturing and intellectual property is already domiciled in the US, it is unclear whether tax advantages could be leveraged in a deal,” MacKay noted.