Roche Makes Hostile $5.7 Billion Bid for Illumina
Roche’s hostile bid, which is similar to the tactic it used in the 2008 purchase of Ventana Medical Systems, leaves Illumina with the options of fighting the bid by trying to maintain control of its Board, entertaining higher bids from other companies or soliciting a higher bid from Roche. Roche confirmed on January 27 that its fourth-quarter revenues declined 4% year over year, but grew approximately 6% sequentially, to approximately $250 million.
San Diego, CA 1/24/12; Basel, Germany 1/25/12; San Diego, CA 1/26/12; Basel, Germany 1/27/12; San Diego 1/27/12; Basel, Germany 1/31/12; San Diego, CA 1/31/12—Roche has launched a hostile takeover bid for Illumina, following what Roche stated were multiple efforts to negotiate directly with Illumina. Roche has commenced a tender offer for shares of Illumina for $44.50 per share, a 64% premium over Illumina’s stock price on December 21, 2011, which is the last day before rumors of the transaction were made public (see IBO 12/31/11). The offer is valued at $5.7 billion. Roche stated that it plans to gain control of Illumina’s Board by nominating four directors to Illumina’s Board at the company’s 2012 annual meeting. Roche also plans to propose an increase to the size of Illumina’s Board from nine to eleven directors so as to fill the additional seats with its nominees. Illumina stated that its Board is reviewing the proposal and will make a recommendation to shareholders by February 10. Illumina also adopted a Rights Agreement in order to deter coercive takeover tactics and postponed its fourth-quarter 2011 earnings announcement, which was scheduled for January 31. (For more, see page 1.)
