S&P places Genzyme on positive watch

Standard & Poor's said it placed the A- corporate credit and all other ratings on Genzyme Corp. on CreditWatch with positive implications because of continued reports of a potential acquisition of Genzyme by higher rated sanofi-aventis.

Sanofi-aventis remains intent on acquiring Genzyme, and the two companies are continuing discussions, S&P said.

Despite the still low acceptance rate of Genzyme's shareholders to date, the agency said it believes sanofi-aventis will continue to pursue the transaction, the agency said.

According to pro forma calculations, including a potential premium from contingent-value rights linked to the future success of Genzyme's multiple-sclerosis drug Lemtrada, the acquisition could weaken sanofi-aventis' financial metrics at least through 2011, S&P said.

Still, the agency said it believes any negative ratings action on sanofi-aventis would be limited to one notch.

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