Icahn's move on Biogen seen as sale prep; Abbott buyout on track; TD Ameritrade shares up on new stake

By Cristal Cody

Tupelo, Miss., Feb. 6 - Carl Icahn's latest nominations to the board of Biogen Idec Inc. and proposal to move the company's incorporation from Delaware to North Dakota are moves designed for a sale, analysts told Prospect News on Friday.

"Carl Icahn does this stuff to exert his influence on potentially getting the company sold," said Christopher James, an analyst with Rodman & Renshaw LLC.

Moving to another deal, Abbott Laboratories said Friday that the acquisition of Advanced Medical Optics, Inc. cleared the U.S. antitrust review, and the acquisition is expected to easily receive European Union regulatory clearance and shareholder approval, an analyst said Friday.

In other action Friday, shares of TD Ameritrade Holding Corp. rose after TD Bank Financial Group confirmed it will up its stake to control 45% of the company.

Meanwhile on Friday, investors sent stocks up across all indexes.

The Dow Jones Industrial Average rose 217.52 points, or 2.70%, to close at 8,280.59.

The S&P 500 index added 22.75 points, or 2.69%, to finish at 868.60, and the Nasdaq Composite index rose 45.47 points, or 2.94%, to 1,591.71.

Icahn eyes Biogen

Icahn Partners LP said Friday that it will nominate four new directors to Biogen Idec's board.

Icahn's first round of nominations for directors to Biogen's board failed to gain shareholder support in June 2008.

Icahn also proposed increasing Biogen's board to 13 members from 12.

Biogen said in a statement Friday that the board "will review the notice and consider it in light of the best interests of all shareholders of the company."

Analysts were baffled as to Icahn's reasoning behind the proposal to move the incorporation to North Dakota but all agreed the moves are designed to rig a sale.

Icahn did not return a call for comment.

Han Li, an analyst with the Stanford Group Co., said there are probably tax advantages to the North Dakota incorporation.

"He's trying to get the company to sell itself," Li said. "They want to push the management out first."

Icahn took over ImClone Systems Inc.'s board in 2006 and pressed the sale of the company to Eli Lilly & Co. last year.

On Friday, Biogen said that fourth-quarter profit rose 3% and the company expects a profit of more than $2.80 per share in 2009. The company earned $206.7 million, or 70 cents a share, in the October-to-December period, compared with $201.2 million, or 67 cents a share, in the same period a year earlier.

The Cambridge, Mass.-based company makes the multiple sclerosis drugs Avonex and Tysabri and other products for rheumatoid arthritis and lymphoma.

Biogen shares fell 80 cents, or 1.50%, to close at $52.48 in trading Friday. The stock has traded from $37.21 to $73.59 over the past year.

Advanced Medical Optics buyout a given

Abbott has offered $22.00 a share in cash for Advanced Medical Optics, a premium of more than 100% to where shares had traded before the offer. The tender offer expires on Feb. 24.

Shares of Advanced Medical Optics closed up 4 cents, or 0.18%, to $21.88 in trading Friday. Shares have traded from $2.88 to $24.90 over the past year.

An analyst who follows the company said Friday that the buyout is likely to have few problems with European regulatory approval and shareholder votes.

"This is the best-case outcome for them at this point," the analyst said.

The acquisition is expected to close in the first quarter of 2009.

Abbott shares rose by 62 cents, or 1.10%, to $57.15 on Friday.

TD Bank to up TD Ameritrade stake

Shares of TD Ameritrade rose by 84 cents, or 6.59%, to $13.58 on Friday after TD Bank Financial, parent of Toronto-Dominion Bank, confirmed it will up its stake by 5% to control 45% of the company.

TD Bank Financial said it will buy 27 million shares for about $515 million with a closing date expected on March 2.

Under terms of a stockholders agreement, TD Bank Financial's ownership of TD Ameritrade had been limited to 39.9%. The limit was increased to 45% on Jan. 24 through an amended 2006 hedging agreement.

"As we've said before, it's been our intention for some time to take advantage of this opportunity to increase our ownership stake in this strong franchise," Ed Clark, president and chief executive officer of TD Bank Financial, said in a statement.

U.S.-listed shares of Toronto-Dominion Bank rose by 80 cents, or 2.52%, to $32.58.

Mentioned in this article:

Abbott Laboratories NYSE: ABT

Advanced Medical Optics, Inc. NYSE: EYE

Biogen Idec Inc. Nasdaq: BIIB

TD Ameritrade Holding Corp. Nasdaq: AMTD

Toronto-Dominion Bank NYSE: TD

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