In a recent interview, Pfizer's
Great idea, Jeff! Becoming less dependent on any one product is a wonderful notion -- especially for a company that's about to see $12.4 billion worth of Lipitor sales vanish in a few years. Even in areas beyond health care, conglomerates like General Electric
But Kindler seems to have missed the point about how to become diversified. You don't do it with one huge, overpriced acquisition, as Pfizer tried to do by buying Wyeth
Acquirer |
Target |
Price |
---|---|---|
Johnson & Johnson |
Omrix Biopharmaceuticals |
$433 million |
Mentor |
$1.2 billion |
|
Human Performance Institute |
Not disclosed |
|
Abbott |
Advanced Medical Optics |
$2.9 billion |
Ibis Biosciences |
$215 million |
|
Nova Science |
$13 million |
Source: Capital IQ, a division of Standard & Poor's.
See anything approaching Wyeth's $68 billion price tag? Not even close. The largest acquisition listed in Capital IQ's database for Johnson & Johnson is, ironically, its $16.6 billion acquisition of Pfizer's consumer health-care division in 2006. For Abbott, it was the $7 billion acquisition of BASF's pharmaceutical business back in 2001.
Pfizer hasn't done a very good job of integrating large acquisitions in the past, and investors should be especially wary of a repeat performance. Instead, investors would probably be better off looking at Sanofi-Aventis or GlaxoSmithKline
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