The share price of the French drugmaker Sanofi-Synthelabo fell sharplyon January 7 on the Paris Bourse in the wake of rumors that the petroleum major TotalFina Elf was about to reduce further its stake in the company. The firm's price dropped 9.9% to 55.75 euros ($52.87) on the day before rallying to close 3.4% down at 59.8 euros.
Paris-based analysts said that the rumor had affected the price quite apart from profit-taking, after a year during which Sanofi-Synthelabo's share price had performed well. Both TotalFina Elf and the cosmetics major L'Oreal have agreed to hang on to stakes of 19.5% each until December 2004, but the former firm holds 32.7% and is free to sell off 13% of its stake in search of added liquidity.
Meanwhile, the market sees some significance in the fact that the oil company has been selling off its holding in Sanofi-Synthelabo gradually, indicating perhaps that the drug company will not be acquired by a multinational group at 100%, leaving some speculative value in the stock.
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