Eli Lilly’s proposed $1.4 billion acquisition of Point Biopharma Global has encountered a hurdle as shareholders of the radiopharmaceutical company appear to be resistant to the tender offer.
To allow more time to fulfill the minimum tender condition, Eli Lilly has extended its cash tender offer for Point at $12.50 per share until December 1. Initially, the offer was set to expire on Thursday. However, less than 26.5% of Point shares have been tendered, prompting the extension.
Numerous Point investors have filed lawsuits, claiming that the company provided incomplete or misleading information relating to the takeover. One such investor, biotechnology investment firm BVF Partners, disclosed a 16.5% stake in Point and announced its decision not to participate in the tender offer. BVF believes that an acquisition by Eli Lilly before the release of results from Phase 3 study of PNT2002 in metastatic castration-resistant prostate cancer would not be beneficial for Point’s shareholders. Instead, BVF recommends waiting for the study results, expected by the end of the year, as they foresee potential significant upside for Point’s shareholders.
Eli Lilly has obtained all necessary regulatory approvals for the acquisition, which represents an 87% premium to Point’s closing price of $6.68 before the announcement. Nevertheless, Point’s shares closed at $13.33 on Thursday, reflecting a 6.6% increase above the takeover price. This suggests that investors are hesitant about the deal.