Roche still has eyes for Genentech

Feb 12, 2009
By Pharmaceutical Technology Editors

Following in the wake of several acquisitions and mergers made by Big Pharma companies, Roche seems more determined than ever to get hold of Genentech and has made an offer of $86.50 (66.3 euro) per share directly to the company’s shareholders. Roche already owns 55% of Genentech’s outstanding shares and expects to commence the cash tender offer within approximately 3 weeks.

The offer replaces the public proposal made by Roche in July 2008 to acquire all the publicly held shares for $89 (68.3 euro) per share by means of a negotiated merger.

”We intend to create unrivalled benefits for our patients, Employees and shareholders by combining Roche and Genentech,” says Franz B. Humer, Chairman of the Roche Group. ”We are disappointed that the discussions during the last 6 months between Roche and the special committee of Genentech have not produced a negotiated agreement. We feel it is now time to give the Genentech minority shareholders the opportunity to decide on our offer.”

After receiving Roche’s original proposal last year, the Board of Directors of Genentech, with the full support of Roche, created a special committee comprising independent directors to consider and respond to the proposal. The commencement and completion of the new tender offer do not require any approval by the special committee or the Genentech Board, and Roche has not asked the special committee to approve the offer.

If following the consummation of the offer Roche owns 90% or more of the Genentech shares, it will seek to consummate a merger.

”This offer does not change our initial plan on how we combine the two companies and operate the new entity,” says Severin Schwan, CEO of the Roche Group. ”We have great respect for our colleagues at Genentech, and we will take the necessary steps to nurture Genentech’s innovative and unique science-driven culture.”