Hostile Roche bid may be too slim for shareholders - San Francisco Business Times:

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billion, about $1.6 billion lower than its previous Swiss pharmaceuticals giant Roche is nowoffering $86.509 a share for South San Francisco-baseds Genentech — $2.50 less than the offer it made last July and a committee of independent Genentech directorxs rejected in August. Genentech (NYSE: DNA) sharesx closed at $84.09 Thursday. That may be too slim of a premiujfor shareholders, especially when analysts generally put the ultimate pricew of a Roche-Genentech deal at $100 per “This has been a long drawn-out dance,” said Rod Ferguson, managing director of and the former head of businesws development for Genentech.
“There’s a real game of chickejn beingplayed here.” Roche already owns 55.8 percent of Genentech. One of the reasons for the six-monthg process, Ferguson said, is the size of the deal between one ofthe world’es largest pharmaceutical companies and the world’es largest biotech. Also, Roche has tried to be sensitive to thevaunter “Genentech culture.” “We have great respect for our colleagues at Genentech and we will take the necessaryy steps to nurture Genentech’s innovative and unique science-drive culture,” Roche CEO Severn Schwamn said in a statement according to the Wall Street Journal .
But the hostiler offer could upset that some people who follow the companyhave “In the end, cash wins (over culture),” Ferguson Among the possible deal alternatives: Genentecjh management assembling minority shareholders for a bid that buys some of Roche’as shares and Roche part-owner workingv with Genentech on a deal to buy Roche. Roche last year said it plansz to shut down its PaloAlto campus, wherw it employs 3,000, and shift an undisclosex number of jobs to South San Francisclo and New Jersey. It has said it woulsd keep Genentech’s South San Francisco site forindependenr research.
After Roche’s initial offer, Genentech transformeed its stock option program into an employeedretention plan. Payouts from that plan coul beginby mid-year.