MedImmune Executives To Profit Hugely From Sale to AstraZeneca
Friday, May 4, 2007
The Gaithersburg firm detailed Mott's potential payday -- $133.5 million in stock-option payouts and $12.2 million in other payments -- in a filing with the Securities and Exchange Commission that shed light on previously undisclosed details of the sale.
MedImmune's founder, Wayne T. Hockmeyer, and its president of research and development, James F. Young, would each make about $60 million.
AstraZeneca agreed to purchase MedImmune last month for $58 a share, a 53.3 percent increase over the price of a share before the MedImmune announced that it was for sale.
Mott would retain his title, and the company would be a wholly owned subsidiary of AstraZeneca.
The payout for Mott, who has been chief executive since October 2000, is especially hefty because he has several million stock options that would immediately vest. Some of those options could be converted into stock for as little as $7.40 a share -- meaning that the shares would net $50.60 each.
Besides detailing the financial incentives in the deal for MedImmune executives, yesterday's filing said the company retained Goldman Sachs as an adviser in late December as it began considering "various strategic alternatives," one of which is typically a buyout.
Eight days earlier, the company said, it received a letter from a shareholder suggesting a sale. The board dismissed the request, saying MedImmune should "continue to execute on its business plan." That shareholder, Matrix Asset Advisors, sent a similar letter in February, which the board also dismissed.
MedImmune spokeswoman Jamie Lacey declined to comment yesterday.
At a meeting March 7 with MedImmune's lawyers, its board and Goldman Sachs, Mott described the companies that had expressed interest in buying the firm. He recommended that the board authorize management to examine the idea of a sale. The board agreed.
The next day, MedImmune and Goldman Sachs began contacting more than 20 potential buyers to gauge their interest. Eight emerged, including AstraZeneca, which disclosed in a separate SEC filing yesterday that it had been interested in MedImmune since early last year.
MedImmune met with potential buyers from March 21 until April 2. Bids ranged from $44 to $51 per share. AstraZeneca had offered $50. More bidding ensued, and AstraZeneca eventually offered the winning bid of $58 on April 22. The agreement was announced the next day. The companies expect to close the deal next month.