Amgen can afford Actelion but deal unlikely-analyst

* Amgen could pay up to $10.45 bln for Actelion – analyst

* Amgen looking to use overseas cash through deals

* Analyst sees little strategic basis for Actelion buy

NEW YORK, Dec 3 (BestGrowthStock) – Amgen Inc (AMGN.O: ) could pay more
than $10 billion for Swiss biotech firm Actelion Ltd (ATLN.VX: )
without hurting its 2011 earnings, but the deal is unlikely to
happen given the lack of business overlap that would allow for
cost savings, according to an analyst.

“We don’t see the synergies or strategic basis for it,”
Sanford Bernstein biotechnology analyst Geoffrey Porges, who
evaluated the potential for the deal in a research note, said in a
telephone interview on Friday.

Amgen, the world’s largest biotechnology company, has said it
is eyeing acquisition opportunities overseas as it looks to spend
billions of dollars in offshore cash that would otherwise be
subject to heavy taxation were it to be repatriated.

In recent weeks Actelion, which specializes in treatments for
pulmonary hypertension, has repeatedly come up in market rumors as
a potential takeover target for Amgen, with analysts speculating
the U.S. company could pay $9.8 billion, or $75 per share, for the
Swiss biotech.

Porges said Amgen could pay up to $80 per share, or about
$10.45 billion, for Actelion without the deal being dilutive to
2011 earnings. That would represent a 50 percent premium over
Actelion’s current share price and a 90 percent premium to the
stock’s price in early October.

However, with virtually no overlap in therapeutic areas of
focus there is “little room for sales force expense synergies
between the two companies,” Porges said in the note.

Amgen’s core products focus on supportive care for cancer and
kidney patients, through its big-selling drugs to boost red and
white blood cells, as well as inflammatory diseases.

Actelion’s focus on pulmonary arterial hypertension means its
sales force deals primarily with cardiologists, while Amgen sales
representatives target oncologists, nephrologists, rheumatologists
and primary care physicians.

“While a deal with Actelion appears to be financially doable,
we place a relatively low probability on Amgen completing a
transaction with Actelion given the lack of a strategic fit,”
Porges said.

“Other potential buyers with more organizational and portfolio
overlaps seem better positioned to maximize the premium paid to
Actelion’s shareholders,” he said.
(Reporting by Bill Berkrot; Editing by Phil Berlowitz)

Amgen can afford Actelion but deal unlikely-analyst