ROCHE HOLDING has extended its $5.7 billion hostile takeover offer for Illumina for a second time, setting up a showdown next month at the annual meeting of the US maker of gene-mapping tools.
Shareholders will have until April 20th to tender their stock at $44.50 a share, Switzerland-based Roche said in a statement yesterday. The offer had been set to expire last Friday.
Illumina shares are trading at 13 per cent above the bid, indicating stockholders expect a higher price. Investors at Illumina’s annual meeting on April 18th will decide whether to oust four directors and replace them with Roche nominees, which would clear the way for talks between the two sides.
“This could drag on for a long time,” Birgit Kulhoff, a Zurich-based fund manager at Rahn and Bodmer said. “Maybe at some point in time, Roche will increase the offer slightly, but definitely in my view not above $50, and even that is not guaranteed.”
Shareholders tendered about 144,310 Illumina shares by the March 23rd deadline, Roche said, equal to about 0.1 per cent of Illumina’s stock outstanding.
“Illumina’s board of directors continues to believe that Roche’s offer is grossly inadequate and that Illumina is positioned to create far more value than Roche has offered,” Illumina said in a statement yesterday. “Our stockholders clearly agree.”
Roche announced its hostile bid in January, going directly to shareholders after Illumina rebuffed its approaches. Roche chairman Franz Humer and chief executive Severin Schwan have shown patience in winning over acquisition targets.
They waited seven months to raise their 2007 hostile bid for Ventana Medical Systems and 7½ months before they increased a 2008 offer for the 44 per cent of Genentech that Roche did not already own.
Separately, Illumina has been sued by Columbia University for allegedly infringing five patents related to DNA sequencing.
According to the complaint filed yesterday in the US District Court in Wilmington, Delaware, Illumina commercialised its so-called next-generation sequencing products despite knowing about the patents, obtained between 2009 and 2012 and assigned to Columbia. – (Bloomberg/Reuters)
