18 July 1994 00:00 [Source: ICB]
THE ACQUISITION by Sanofi of Sterling Winthrop's prescription pharma business and the group's intention to sell its bioindustry business to meet the $1.7bn cost is viewed by trade unions as upsetting the three-pronged strategy developed over the years by Sanofi.
Fédération Nationale des Industries Chimiques CGT and the CGT trade union within Sanofi have forcibly stated that while the decision to buy Sterling Winthrop 'bolsters the health division, it temporarily hits the strategy conducted over the past years'.
Sanofi's three-pronged strategy -based on health, beauty and bioactivities - helps 'to maintain a global balance when there is a slump affecting one of the divisions', insisted Paul Jeanne, CGT coordinator at Sanofi.
With FF7bn ($1.29bn) sales last year, the bio-business is not the most prosperous of the group, admitted the CGT, but it complements the pharma division: the potential for innovation is much higher in bio than in pharma research. Although the CGT would not have approved either that Sanofi should sell off its cosmetics business to pay for Sterling Winthrop, it disapproves of the 'industrial logic' whereby cosmetics provide greater immediate profit margins.
Indeed it blames the whole Elf Aquitaine logic since its privatisation, which consists of letting the subsidiaries finance their acquisitions with no help from the parent company. 'Elf has lost its federating nature,' pointed out Jeanne.
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