Genzyme (GENZ) is up $2.25 to $70.25 after the Wall Street Journal reported late yesterday that Sanofi (SNY) is “increasingly likely” to take a formal buyout offer to Genzyme’s board. Then, CNBC reported this morning that SNY is likely to send a “bear hug” letter to Genzyme in the next 72 hours. Active trading continues in GENZ options. One player bought 5000 January 75 calls at $2.35 and sold 2,500 Aug 75 calls at 45 cents, possibly rolling a position and looking for an offer substantially greater than $75 per share. However, today’s top trades also include an August 67.5 – Jan 65 put spread, apparently bought at $2.10, 4000X, which might be a hedge should any deal talk fall apart after the August expiration. Lazard downgraded GENZ shares to Hold from Buy this morning. Implied volatility is down 25 percent to 30.