Germanwings schreef op 7 december 2017 02:40:
More acquisitions to come?
By end of Q3, Gilead's liquidity amounted to a whopping $41.36B of which $11.9B will flow to Kite in Q4 which still leaves around $30B in cash. This is on par with Gilead's long-term debt of 29.8B and leaves the company in a comfortable position for further M&A activity.
Previous acquisition targets like Vertex (VRTX) or Incyte (INCY) with market caps of $35B and $20B appear too expensive (despite INCY collapsing from $153 to $94 in the mean time) given that these numbers do not even factor in a premium, which would have to be paid on the acquisition.
However, there are certainly smaller potential acquisition targets left. One of these is Galapagos (GLPG), currently valued just below $5B. Last year Gilead had already paid more than $700M for Filgotinib split into a license payment of $300M and an equity investment of $425M raising Gilead's share to 14.71%. At the end of 2017, the lock-up period to buy or sell shares ends and Gilead could start to increase its stake further or acquire it in total.
Assuming Gilead doubles its stake in Galapagos by paying around $1B, which would bring it above the critical 25% ownership threshold, total liquidity would still be in the mid-to-high $28B range. In the last earnings call, CEO John C. Milligan mentioned the following: