Genzyme’s sales of non-core businesses continues. The Cambridge, MA-based biotech company (NASDAQ:GENZ) said this morning that it has agreed to sell its diagnostic products business to Japan’s Sekisui Chemical for $265 million in cash. The deal takes Genzyme, the world’s largest provider of drugs for rare genetic diseases, a step further in sharpening its focus as it fights off an unsolicited takeover bid from the French drug giant Sanofi-Aventis.

Sekisui, which is expected to close on its purchase by the end of this year, is offering jobs to the some 575 employees of the Genzyme diagnostics business—which has operations in Framingham, MA, San Diego, and at least four other locations, according to Sekisui. The diagnostics business, which brought in $167 million in 2009 revenue, sells raw materials and other products for the cardiovascular, diabetes, infectious disease, and renal health markets.

Genzyme announced in May that it planned to sell off its diagnostics business and two others as part of a plan to raise shareholder value. In September, the 29-year-old company sold its genetic testing business to Burlington, NC-based Laboratory Corporation of America (NYSE:LH) for $925 million. Genzyme still has one of the three businesses, its pharmaceutical ingredients unit, on the block. The company says it might use proceeds from these transactions to finance the second half of its $2 billion stock buyback, which was also announced in May.

Genzyme’s stock closed at $69.75 on Wednesday, November 17.

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San Diego diagnostics firm Sequenom (NASDAQ:SQNM) says it plans to acquire all shares of cancer test maker Exact Sciences’ common stock (NASDAQ:EXAS), despite a rejection from Exact’s board of directors to Sequenom’s recent buyout offer.

Sequenom proposes to buy each share of Marlborough, MA-based Exact for $1.50 worth of Sequenom common stock, a total value of $41 million—essentially the same deal that Exact’s board unanimously dismissed. Exact’s board said it had a better option on the table to maximize shareholder value, although Exact didn’t say exactly what that was. So Sequenom says it would immediately withdraw its latest takeover bid if Exact strikes a “material” out-licensing, financing, or other financial restructuring agreement.

“We are disappointed that the board of Exact Sciences has rejected our proposal,” says Harry Stylli, president and CEO of Sequenom, in a statement. “Unfortunately, the board of Exact Sciences has failed to recognize the potential value the combination of our two companies could provide to our respective shareholders.”

Sequenom, which is developing a prenatal test for Down’s syndrome, says that it wants Exact’s stool-based DNA test for early detection colon cancer to help Sequenom move into the market for noninvasive cancer diagnostics.

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It reminds me of a playground tug-of-war between little kids. Only there’s $40 billion-plus at stake. In any case, the Microsoft-Yahoo battle is heating up again, and this time things could really get nasty. As you might have noticed, there has been a huge flurry of activity and coverage over the past day or so, and I want to point out a few observations that could be particularly telling.

Yesterday, no doubt to help get things rolling, billionaire investor Carl Icahn published an open letter to Yahoo shareholders in which he described having talks last week with Microsoft CEO Steve Ballmer, some of which he said lasted an hour. The gist of the letter was that he and Ballmer have gotten serious about putting a previously aborted deal for Microsoft acquiring Yahoo back on the table. Microsoft also released a statement confirming that acquisition talks with Yahoo could resume if Icahn manages to replace all or part of Yahoo’s nine-member board after the company’s shareholder election on August 1.

Yahoo shot back with a statement of its own, saying it “continues to stand ready” for negotiations and adding that “if Mr. Icahn has an actual plan for Yahoo” other than forcing it to capitulate and accept Microsoft’s offer, then Yahoo would listen. On yesterday’s news, Yahoo (NASDAQ: YHOO) shares rose 12 percent to close at $23.91, and are up to $24.64 as of 4:45 pm ET today.

Let’s back up for a minute. In early May, talks between Microsoft and Yahoo fell through after Yahoo walked away from the Redmond software giant’s $33-a-share, $44.6 billion takeover bid. Icahn, who has since amassed a small stake in Yahoo, then launched a bid to unseat the company’s management and board, claiming that the latter had “botched” the deal.

There has been solid coverage in the Seattle P-I, Bloomberg, and many other outlets. Much of the analysis points to the increasing likelihood of a Microsoft takeover—because Yahoo’s profits are narrowing, its executives are leaving, and it can’t compete with Google on its own. (My informal chats with ex-Microsofties suggest that Yahoo should have seen this coming and is getting what it deserves.)

For instance, David Kirkpatrick of Fortune argues that Microsoft needs to boost the number of Internet searches on its sites to compete with Google, and Ballmer and Co. won’t be denied: “The only way Microsoft can compete with what the business of Google really is—a large marketplace for advertising and searches—is to somehow achieve much greater scale. No method of creating dramatically greater scale seems available other than combining with Yahoo’s search.” And in another Fortune piece, Richard Siklos explains “why Yahoos shouldn’t underestimate Icahn.” Siklos argues that Icahn’s “brilliant touch for ferreting out weakness in big corporate situations” and public-relations savvy makes him a formidable opponent for Yahoo, which “might try to give Icahn a couple of seats on its board to make his proxy fight go away.” (He also points out that one of Icahn’s proposed board members is Mark Cuban, the outspoken and sometimes-controversial owner of the Dallas Mavericks—not sure how that one will go over.)

But more interestingly, the opinion tide may be turning against Microsoft because of questions about its motives. Michael Arrington of TechCrunch writes that until today he’s been a big supporter of Microsoft’s takeover plan because the Internet needs competition in the search market, and “Google controls too much market share and too much related search revenue.” However, after yesterday’s “shenanigans” and “complete nonsense,” Arrington now says Microsoft and Icahn have crossed a line. His take is that Microsoft has been toying with Yahoo after taking its initial rejections too personally. “It’s no longer just about business, it’s about destroying and humiliating the people who embarrassed Microsoft,” he writes.

Saul Hansell of the New York Times concurs, writing that one possible explanation for Microsoft’s actions is that “it wants to destroy Yahoo rather than buy it.” This is an interesting angle to watch, but I would say it’s still too early to tell what Microsoft really wants—and that’s exactly the way Microsoft wants it. In any case, Hansell concludes, “Microsoft seems to be neither a trustworthy partner nor a reliable bidder for Yahoo, no matter who’s on the Yahoo board of directors.”

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“I’d hate to go up against Henri.”

That was the view of Sirtris Pharmaceuticals CEO Christoph Westphal when asked at Xconomy’s Forum last night about recent speculation that two other Cambridge-based biotech firms, Biogen Idec and Genzyme, might be targets of takeover bids after investor Carl Icahn had taken stakes in both firms. The Henri in this case was Genzyme CEO Henri Termeer. And, from the looks of an interview Termeer did for today’s Wall Street Journal, that’s exactly what Icahn or any other Genzyme suitor would have to do: go up against Henri.

“To integrate us to into a very large entity is not that attractive,” Termeer told the Journal. “It is not that good a logical fit. It is much stronger as it is right now—as a stand-alone rather than as part of a company 10 times our size.”

Genzyme, with $3.2 billion in revenues last year, has focused its business on rare disorders, developing treatments that have often been designated “orphan drugs” by the FDA. The orphan drug status allows the company to operate without competition for longer periods of time than usual—and that, combined with the efficacy of the drugs and the limited treatment options available, allows Genzyme to charge premium prices. Termeer said in the interview that Genzyme’s kind of business, and its specialized sales force, wouldn’t fit well in a Big Pharma concern.

Termeer also said he has not communicated with Icahn after initially learning of the maverick investor’s stake in Genzyme last month when Icahn reported in his quarterly SEC filings that he had purchased 1.5 million shares of the company. That stake is less than 1 percent of the outstanding shares.

Genzyme’s stance is in contrast to that of Biogen Idec, another large Cambridge biotech. After Icahn’s interest in Biogen was made public in August—he now has a roughly 3 percent stake in the company—the firm’s board of directors announced it would entertain offers. But, given Genzyme’s reputation—and Termeer’s—for hard-nosed business, it is hardly a surprise that the company would dig in its heels against any takeover bid. That was Westphal’s point last night at the Xconomy Forum: The Future of Innovation in New England (Genzyme and Termeer are significant investors in Sirtris, and Westphal is friends with the Genzyme CEO). Westphal had one other piece of insight to offer in regards to Biogen Idec: he said he hoped that if it is acquired whomever buys the company has enough sense to let it operate largely independently, rather than trying to absorb it into a larger concern.

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Bioenvision shareholders have voted to approve Genzyme’s takeover offer, paving the way for the controversial merger to move forward, the two companies announced late this afternoon. If it closes as planned, the deal—which passed after months of dispute that saw the shareholder vote extended several times—will win Cambridge-based Genzyme (NASDAQ: GENZ) worldwide rights to the leukemia drug clofarabine.

It was a hard-fought victory for both Genzyme and Bioenvision’s senior management, which had unanimously backed Genzyme’s $5.60-per-share offer for the firm—a price that would quickly become the subject of much angst and debate. “We are very pleased that Bioenvision shareholders voted to support this merger,” said Mark J. Enyedy, president of Genzyme Oncology, in the release. “We are deeply committed to furthering the clinical development of clofarabine and making it available on a global basis so that patients around the world with these very difficult forms of cancer will have access to the therapy.”

The vote could also be seen as something of a vindication for Genzyme, which held fast to its offering price even after Bioenvision shareholders initially—and roundly—rejected the deal in July. At the time Genzyme, via a tender offer, was only able to garner about 22 percent of Bioenvision stock, and almost all of that came from Bioenvision’s senior management and directors. How Genzyme was able over the last few months to come back from that seemingly resounding defeat is unclear, but apparently enough shareholders were either tired of the fight or finally convinced by Genzyme’s arguments that it was paying a fair price for the stock.

Either way, the deal cast a strong spotlight on Genzyme, unfolding as it did like the business version of a soap opera. It first made headlines in early June, when Adam Shay, an individual Bioenvision stockholder, put up a website called rejectgenzymetenderoffer.com to make the case against the Genzyme takeover. The main issue for Shay and many other stockholders was that the $5.60 per share price seemed to dramatically undervalue the potential of Bioenvision and clofarabine, which some analysts expect to achieve sales of up to $1 billion per year. Indeed, several analysts had set a roughly $9 one-year price target for Bioenvision.

Shay was joined in his opposition by SCO Capital, then Bioenvision’s largest minority shareholder, with roughly 13 percent of the stock. After an initial tender offer failed to garner a majority of Bioenvision’s shares, Genzyme extended the offer—only to lose shares during the extension period as some stockholders changed their minds. When the dust settled the company only had about 22 percent of the stock; it needed 50 percent plus one share for its bid to go through.

Suffice it to say things got even wilder from there. Later in July, SCO Capital filed a letter with the SEC claiming it had rights to two Bioenvision board seats. The filing also called for a senior management overhaul and revocation of Genzyme’s existing sub-license to clofarabine in the U.S. and Canada. Genzyme fired back and said it would block any attempts to put SCO representatives on the board. About a week later, Genzyme subpoenaed Shay. The clearly upset North Carolina resident stopped his blogging on the deal, posting a final note on his website lambasting Genzyme. “I never realized the extent to which they are willing to go to quash dissension…” he wrote. “At the end of the day it doesn’t come down to how much money you have. It comes down to right and wrong and how that all sorts out with the man upstairs.”

And that wasn’t all. A number of individual and class-action lawsuits have been filed against both Bioenvision and Genzyme related to the deal. And one of the Bioenvision executives who sold his shares ($1.7 million worth) himself filed suit in New York State court seeking $108 million. According to the Boston Herald, he alleged that Bioenvision breached his employment agreement and had failed to pay him for his role in facilitating the deal.

Still not done. A special meeting for Bioenvision shareholders to vote on the issue was held on October 4. With the vote close—47 percent of shareholders had indicated their support for the merger—Bioenvision management adjourned the meeting for one day. The next day came, and management announced the voting had closed but it needed more time for the inspector of elections to tally the results. An answer was promised by October 10, but, you guessed it…not done yet. The night before the promised results, Bioenvision and Genzyme petitioned the Delaware Court of Chancery for permission to reopen the polls until October 22. It turned out Bioenvision had closed the voting the previous week thinking it had enough support to complete the deal, when in fact it was short by 239,000 votes—and had inadvertently shut out a large shareholder who had wanted to vote in favor of the merger. The court agreed. Today’s October 22. And this time, it looks as though (we’re hesitant to pronounce anything as final in this saga—and attempts to reach SCO Capital officials for their reaction were unsuccessful) the merger has been approved. According to the press release, the final tally saw 56 percent of Bioenvision shares voting in favor of the merger.

And let’s give Genzyme credit. Throughout the trials and tribulations it has held fast to its offer. “We believed $5.60 per share was a full and fair price for the company then, and we believe that to be the case now,” Enyedy wrote to the Bioenvision board late last month. Apparently other people ultimately believed it, too.

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Am I the only one here who’s having disturbing flashbacks to November 2000? Remember those long weeks when otherwise rational people were driven to distraction trying to find an answer to the once seemingly simple question of who won the vote? We’ve been following Genzyme’s troubled bid to acquire New York-based Bioenvision for months now (see this story for a recent summary) and, though I’m the first to admit the stakes aren’t as high as those of a presidential election, I’d really just like to know who won.

Well, looks like that’s not going to happen today, or even next week. When last we heard from the two companies, on Friday, Bioenvision had closed voting on the proposed merger and adjourned a special meeting of its shareholders until today when, a spokesperson for the firm assured me, the results would be announced. But last night Bioenvision and Genzyme jointly petitioned the Delaware Court of Chancery for permission to reopen the polls until October 22 and, according to a shareholder who attended today’s meeting, Bioenvision says the court this morning granted the request.

So what’s the issue? Not hanging chads, at least not according to the court filing, but rather a mini comedy of errors that ultimately led to Bioenvision closing the vote at 11:29 a.m. on Friday thinking it had the majority needed to seal the deal, when in fact it was short by 239,000 votes, or 0.43 percent of its shares. At 12:11 p.m. Broadridge—which was charged with processing the proxies and votes by institutional investors—transmitted another shareholder’s proxy to the American Stock Transfer and Trust Company (AST), which was serving as the inspector of elections. Instructions for that vote—of 3.1 million shares in favor of the merger—were originally communicated to Broadridge at approximately 11:15 a.m., according to the filing, but Broadridge initially refused them. And since the votes ultimately arrived after the polls were closed they weren’t counted. For more on this chapter of the saga, see the court filing here. (Trust me, it’s an good read.)

“This whole process has really not served shareholder interest,” says Steven Rouhandeh, chairman of SCO Financial Group, one of the minority shareholders that has vehemently opposed the merger. “They keep taking a swing and a miss, right? Those votes came in after the deadline. So, we’ll see.”

For sanity’s sake, let’s hope it’s not December by the time we do.

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A special meeting of Bioenvision shareholders, continued from yesterday, was adjourned once again this afternoon with no final word on whether or not the shareholders had approved Genzyme’s bid to acquire the New York-based biotech.

The meeting was originally convened yesterday so that Bioenvision (NASDAQ: BIVN) shareholders could vote on Cambridge-based Genzyme’s (NASDAQ: GENZ) much-debated $5.60-per-share offer for the firm. When yesterday’s meeting was adjourned, about 47 percent of the shares had been voted in support of the merger (a simple majority is needed to approve the deal, and shares that aren’t voted are counted as nos) and Bioenvision CEO Christopher Wood announced that voting would be held open until today.

Attendees at today’s meeting were told that while the voting is now closed, the inspector of elections needs additional time to count the votes. “We’ll just have to wait and see what happens,” said Steven Rouhandeh, chairman of SCO Financial Group, which has been a vocal opponent of the merger. Rouhandeh points out that this is essentially the fourth time shareholders have voted on the deal, referring to Genzyme’s original tender offer (which failed to garner a majority of Bioenvision shares), an extension of the offer (ditto), yesterday’s voting deadline (ditto), and today’s finally completed vote. “Our view is that this process has gone on long enough, and it should come to some kind of closure,” Rouhandeh says.

Perhaps that closure will come next Wednesday at 11 am, when the shareholder meeting reconvenes. A Bioenvision spokesperson says that a final tally could come even sooner, but that if not, the verdict would be announced at Wednesday’s meeting.

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With the vote on Genzyme’s takeover bid seemingly far closer than expected, shareholders of New York-based Bioenvision adjourned a special meeting today, the company announced this afternoon. The session will resume tomorrow with the outcome apparently too close to call.

At issue is Cambridge-based Genzyme’s (NASDAQ: GENZ) $5.60-per-share offering price for Bioenvision (NASDAQ: BIVN). That price was, in effect, rejected earlier this summer when shareholders only tendered about 22 percent of outstanding shares under Genzyme’s initial tender offer, and almost all of the shares tendered at that point were from the Bioenvision board members. At today’s session, though, according to the announcement, holders of about 47 percent of “the company’s issued and outstanding shares of common stock and preferred stock” had indicated their support of the merger. A simply majority vote is needed for the merger to go through.

Throughout the process, New York investment firm SCO Capital Partners, which holds about 13 percent of Bioenvision stock, has led the fight against the bid, most recently reiterating its stance on Monday. SCO said it believes Genzyme’s offer far undervalues Bioenvision and has pressed for a shakeup of the firm’s management. In July, SCO filed a letter with the SEC announcing its intention to remove two Bioenvision board members and replace them with SCO representatives. SCO also is also seeking to terminate Genzyme’s current rights to Bioenvision’s leukemia drug clofarabine.

The Associated Press reported today that Institutional Shareholder Services, a proxy advisory company owned by Riskmetrics Group, had also advised investors to reject the bid. ISS identified an offer in the $8 to $12 range as a more suitable bid for Bioenvision, according to the AP account.

Steven Rouhandeh, chairman of SCO Financial Group, was not happy with the way things went, but he was hopeful the merger would not go through. Rouhandeh said he attended the meeting and that Bioenvision’s CEO, Christopher Wood, stood up and made an announcement of the vote so far, and then adjourned the meeting. “I felt like a reporter. I tried to shout out a question. They said they weren’t taking any questions,” Rouhandeh told me this afternoon. “When will management heed the will of shareholders and call it a day?” Rouhandeh said. “You’ve gotten three no votes. How many times do we have to vote?”

Rouhandeh would not offer a prediction for the final outcome. “It shouldn’t go through and it hasn’t gone through, and we continue to hope it won’t go through because we don’t think it is in the best long-term interest of shareholders.”

Genzyme, for its part, has held fast to its offer throughout the process, which began in May. In a letter to the Bioenvision board last week, Genzyme President Mark J. Enyedy wrote that the company wanted to end any speculation that his company would raise its offer. “We believed $5.60 per share was a full and fair price for the company then, and we believe that to be the case now,” Enyedy wrote. He said the company was prepared to proceed as “an active and constructive” minority shareholder.

Bioenvision stock closed trading today at $5.43, up 18 cents. Genzyme closed up $0.07 at $67.85.

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With shareholders of New York-based Bioenvision (NASDAQ: BIVN) set to vote in one week on a controversial proposed merger with Genzyme (NASDAQ: GENZ), the Cambridge, MA-based biotech giant reiterated today that it would not raise its offer for shares of the New York firm.

In a letter to the Bioenvision board, Genzyme President Mark J. Enyedy wrote that the company wanted to put an end to any speculation that the offer would be raised above the $5.60 per share price set in a merger agreement hammered out in May. “We believed $5.60 per share was a full and fair price for the company then, and we believe that to be the case now,” Enyedy wrote.

The fairness of the price has been the subject of much discussion and debate since the deal was first announced. Various individual and institutional Bioenvision shareholders have campaigned against the deal, on the argument that it severely undervalues the firm, have called for Bioenvision board to be revamped, and have argued that Genzyme’s current rights to Bioenvision’s leukemia drug clofarabine—the big prize in the would-be merger—should be revoked. Meanwhile, a number of class-action and individual lawsuits have been brought against both Genzyme and Bioenvision related to the deal.

In today’s letter, Enyedy outlined Genzyme’s arguments in favor of the $5.60 price. Among them:
—The price represents a 44 percent premium over average for Bioenvision in the 60 days leading up to the May agreement. (Critics have countered that the price at that time was artificially depressed, due to a recent sale of some 8 million shares to finance clinical trials of clofarabine.)
—Bioenvision has no other acquisition offers on the table.
—Should it remain an independent company, Bioenvision faces challenges including uncertainty that it will obtain projected regulatory approvals for clofarabine, the need to raise significant capital to support operations until the company becomes profitable, and the potential that the pending litigation could drain the firm’s financial and human resources.

Genzyme says it plans to stick with Bioenvision whether or not shareholders approve the merger. “Should Genzyme not garner the majority support from shareholders for this merger,” the company said in a press release, “it is committed to playing an active and constructive role as a significant long-term shareholder of Bioenvision.”

Shares of Bioenvision closed today at $5.26, down from yesterday’s close of $5.43.

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New York-based Bioenvision today reported a big jump in revenues, and the leading minority shareholder opposed to the company’s proposed merger with Genzyme pointed to this surge as an indication Genzyme’s offer price far undervalues the company—and filed a letter with the SEC that showcases his strategy to block the deal.

Steven Rouhandeh, chairman of SCO Capital, a New York merchant bank, has long taken the lead in objecting to Genzyme’s $5.60 per share offer for Bioenvision. A special vote on the matter is scheduled for October 4, but shareholders already soundly rejected the terms earlier this summer by declining to tender shares under Genzyme’s offer—and Rouhandeh said today things aren’t going to change at the formal vote. Instead, he wants to move forward with plans to remove two Bioenvision board members and replace them with SCO representatives. He also wants to terminate Genzyme’s rights to Bioenvision’s leukemia drug clofarabine. All this is detailed in today’s SEC filing.

The crux of the issue has been the valuation of Bioenvision. In today’s quarterly and year-end report, Bioenvision relayed that revenues for the fourth quarter that ended June 30 had risen to roughly $6.75 million from $1.8 million a year earlier. Year-end revenue totals, meanwhile, were $19.1 million for fiscal 2007, compared to $5.3 million for 2006. The performance was significantly above analyst expectations. Bioenvision’s losses widened during the period, but Rouhandeh says the overall trend was good.

“It was very upbeat,” Rouhandeh says of the Bioenvision earnings report. “The company only looks better than it did four months ago [about when the tender offer was proposed],” he says. Sales are so strong, and the biotech sector in general is looking so good, Rouhandeh adds, the company might do far better to remain on its own than to try and come to better terms with Genzyme. “As a standalone company, it looks very strong,” he says.

“The reason we invest in some of these companies is to play for the home run, and I think we’re on the cusp of that. Selling it now is selling it prematurely.”

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Shareholders of New York-based Bioenvision (NASDAQ: BIVN) have yet to vote on Genzyme’s (NASDAQ: GENZ) much-maligned $5.60-per-share offer for the firm, but one of them is making its intentions clear now. In a scathing letter to the Bioenvision board dated yesterday, Hedge fund Elliott Associates wrote that it is “extremely dissatisfied with the proposed Genzyme transaction” and will not vote for it.

In the letter, Elliott said that it and its sister fund, Elliott International, own approximately 6.7 percent of Bioenvision’s common stock. In fact, a recent SEC filing shows that Elliott has been squirreling away Bioenvision shares throughout the summer—with significant purchases after Genzyme announced its takeover bid.

Elliott has a reputation for activist fund management, and has previously locked horns with the likes of Procter and Gamble to the benefit of small investors. That should offer some encouragement to the common stockholders who have argued all along that the $5.60 price tag isn’t fair; a majority refused to tender shares under Genzyme’s original offer, which closed on July 10. Indeed, the “outrageously low valuation at which Genzyme is attempting to appropriate Bioenvision” is one of the key objections raised in Elliott’s letter to the Bioenvision board, which cites price targets for the firm ranging up to $13.

The hedge fund also points to apparent conflicts of interest at play in the deal, given that “directors associated with Perseus-Soros, the Company’s largest shareholder and an eager seller of stock, were intimately involved in the sale process.” The letter continues: “In our opinion, it would not be an exaggeration to state that this sale process had a greater resemblance to a ‘fire sale’ than an auction. With substantial cash in the bank, a growing revenue stream, a currently approved and highly promising product, and positive catalysts around the corner, the (unconflicted) Board members had absolutely no need to rush to sell the Company, let alone to hurriedly accept such an inadequate offer.”

Elliott made clear, however that it was not opposed to the idea of a Bioenvision sale to Genzyme “at a fair valuation.” All in all, its sentiments mirror those expressed by another large minority shareholder, New York’s SCO Capital, which has also filed several letters with the SEC registering its opposition to Genzyme’s bid. Its latest filing, in July, called for revocation of Genzyme’s North American rights to the Bioenvision leukemia drug clofarabine.

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For anyone who’s been following Genzyme’s attempted merger with New York-based biotech firm Bioenvision (NASDAQ: BIVN), one phrase likely comes to mind: What a mess.

Here’s a quick summary of what we’ve covered so far (the related posts list at right pretty much has everything): Individual shareholder protest. Merger rejected. CEO and other execs cash out. Board members resign. At least five class action lawsuits. Bid to end Genzyme’s license to Bioenvision’s leukemia drug.

And all this in only about two months. Then comes word today that one of the execs who cashed out (to the tune of $1.7 million), former Bioenvision executive vice president and general counsel David Luci, has filed suit in New York State court seeking $108 million. According to a small item in the Boston Herald, Luci alleges that Bioenvision breached his employment agreement and has failed to pay him for his role in facilitating the attempted sale of the company to Genzyme (we note that Cambridge-based Genzyme (NASDAQ: GENZ) was only able to amass about 22 percent of Bioenvision stock).

“Wow. It does seem like a mess,” concurs Ren Benjamin, an analyst who follows Bioenvision for New York investment house Rodman & Renshaw, when we told him about the Luci lawsuit.

We tried unsuccessfully this morning to find out more about the lawsuit. Benjamin, though, provided some good perspective about the takeover—and how the mess might be cleared up over time. First, he says, “I don’t want to call it a failed takeover, but it is one that is a little bit in limbo.” He notes that Genzyme already has North American rights to the leukemia drug, clofarabine, so it makes perfect sense for the company to want to take over Bioenvision and acquire the drug’s worldwide rights. He was only surprised at the $5.60 per share offer. (Many analysts set a one-year target price for Bioenvision stock of closer to $9 a share). “We just didn’t expect it at this low a valuation,” Benjamin says.

Predicting an outcome to the current stalemate is harder since Bioenvision’s key managers, including CEO Christopher Wood, sold all of their personal shares to Genzyme as part of the takeover bid, Benjamin says. “So the question is how is that going to continue to move forward…how are the shareholder interests and management interests going to stay in alignment?”

With a lot of clouds hovering over this case, Benjamin feels it will be a while before things are resolved. Still, he says, “I’m going to guess that the stock price is going to stay around where it is right now [$5.43 as we write this], which is around where Genzyme had placed their takeout bid.”

Bioenvision shareholders, he notes, are obviously hoping Genzyme will come back with a higher offer (which, in light of a proposed special shareholder vote on the merger, we speculated about earlier this week). But Benjamin says the Cambridge company can probably bide its time about buying up more Bioenvision shares, if indeed it decides to continue pursuing a takeover at all.

“They can sort of let everything continue the way it’s going and wait for Bioenvision to continue to execute,” he says. It’s a bit of a double-edged sword, though. “If they execute well, they’ll be buying the rest of the company at a higher price,” Benjamin says. If Bioenvision doesn’t execute well, then Genzyme might get the company at a lower price, he adds.

But if things aren’t looking good, we wonder, will Genzyme still want Bioenvision at all?

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