Bloomberg News

Roche Begins $5.7 Billion Hostile Takeover Bid for Illumina

February 01, 2012

(Updates with closing shares in fourth paragraph.)

Jan. 27 (Bloomberg) -- Roche Holding AG began its $5.7 billion hostile takeover offer for Illumina Inc., even as investors signaled they expect the Swiss drugmaker to raise its bid for the gene-mapping company.

Shareholders of Illumina have until midnight New York time Feb. 24 to tender their shares at $44.50 each, Basel-based Roche said today in a statement. The offer can be extended, Roche said. Investors should take no action while the board reviews the proposal, Illumina said in a separate statement.

Roche is going directly to Illumina shareholders because the San Diego-based company rebuffed its approaches, Roche said Jan. 25. Illumina is adopting a “poison-pill” defense to block the takeover. Roche also wants to nominate six members of the Illumina board at the U.S. company’s annual meeting.

Illumina’s stock has traded above the offer price since the announcement amid speculation of a higher bid. The company fell 1.8 percent to $51.69 at the close in New York.

Roche said in a statement yesterday it was “disappointed that the Illumina board of directors has been unwilling to participate in substantive discussions,” adding that it was confident shareholders will see the offer’s value.

The Swiss maker of cancer drugs wants to bring Illumina’s gene-sequencing technology out of academic labs and into routine medical use, building the Roche palette of health diagnostics products and potentially allowing it to better target its own medicines toward individual patients. Illumina said on Jan. 10 that by the end of the year it would market a machine capable of scanning DNA in a day.

Roche fell 1.9 percent to close at 157.10 Swiss francs in Zurich, giving the company a market value of 136.6 million francs ($149.3 billion.)

--With assistance from Meg Tirrell in New York. Editors: Tom Lavell, Phil Serafino

To contact the reporter on this story: Naomi Kresge in Berlin at nkresge@bloomberg.net

To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net


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