MELVILLE. N.Y. (TheStreet) -- OSI Pharmaceuticals (OSIP) shares soared almost 52% Monday after it said it would review an unsolicited takeover proposal from Japanese drugmaker Astellas Pharma with its advisers.
But the chances of OSI accepting the bid are low as it rejected a similar oral proposal from Astellas in February.
Astellas on Monday launched a hostile tender offer of $3.5 billion for OSI, the maker of the lung cancer drug Tarceva. Astellas' offer of $52 a share was a 40% premium over OSI's closing price Friday of $37.02.
The tender offer is expected to begin Tuesday.OSI shares gained $19.23 on Monday to close at $56.25, in anticipation that OSI could receive a higher bid. Astellas said its hostile tender offer for OSI comes after numerous previous attempts to buy the U.S. drug company were turned away. In a press release Monday, following news of the Astellas bid, OSI released a copy of a letter dated Feb. 22 in which it rejected an oral proposal of $52 a share from Astellas, saying it wasn't "interested in undertaking a sale of OSI at that price, since it believes Astellas' proposal very significantly undervalues the company." In responding to the February proposal, OSI said it offered to provide Astellas with non-public information which it said was fundamental to its valuation of OSI. The response to that letter was Astellas' unsolicited proposal, OSI said. -- Reported by Joseph Woelfel in New York. Follow TheStreet.com on Twitter and become a fan on Facebook.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV