Bioenvision Inc. (NDAQ:BIVN) may have trouble pushing through its proposed merger with Genzyme after a major shareholder reiterated its intentions to vote against it in the company's upcoming annual meeting. Shareholders are divided on the issue that promises to be a close call on October 14th.

SCO, which owns 13.1% of Biovision, called the $5.60 offer extremely inadequate and the result of a poorly managed and ill-timed sale process. The activist hedge fund believes that the company should instead work on behalf of shareholders to maximize value over the near term through alternative strategies.

"We remain highly confident that clofarabine will be approved in the European Union for the treatment of adult AML in 2008," said SCO in a letter to the board. "We believe that Bioenvision will be well positioned, within a 3 to 6 month timeframe, to engage an independent investment bank to do a well-run process to market the company to possible acquirors, and that there will be considerable interest in clorfarabine. We believe that this type of processs could lead to an offer price well in excess of the current offer price, leading to a success for all common shareholders including Genzyme."

SCO also announced that it intends to propose a new slate of directors for the next annual shareholders meeting that would work to this end and unlock value for common shareholders. Combined, these factors make BIVN a stock worth watching!

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