Inside Sanofi's $3.2B Translate Bio Buyout

Before the $3.2 billion acquisition of mRNA player Translate Bio Inc TBIO earlier this month, Sanofi SA SNY expressed interest in selling off around 25% of its shares in the company, which it had been working with since 2018.
Translate Bio filed SEC document to give an inside look at how the buyout negotiations played out. Translate agreed to that plan, but it didn’t last long.
Sanofi CEO Paul Hudson reached out to Translate CEO Ron Renaud in late May, indicating that Sanofi was now interested in buying Translate outright. The initial offer came in at $28 per share.
Translate asked its consultants to test the waters for other potential suitors as part of its due diligence on a possible deal. Feelers put out to three companies that turned up duds, with all three showing no interest in engaging.
On June 4, Translate told Sanofi that its initial offer was “insufficient” and undervalued the company. Sanofi responded with a 55% premium offer, but Translate asked for $40 per share as a final offer.
In response, Translate asked Sanofi an offer of $37 to $38 per share with milestones baked in to get shareholders $40 per share.
Sanofi countered with an offer of $35 and eventually agreed to come up to $38.
The acquisition also makes sense in Sanofi’s plans to make mRNA a centerpiece of its business plan moving ahead.
In June 2020, Sanofi laid out $425 million in cash upfront and up to $1.9 billion in milestones payments to accelerate its partnership with Translate, signed initially in mid-2018.
Price Action: SNY stock closed up 0.21% at $51.87, while TBIO shares closed down 0.21% at $37.66 on Monday.

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