Roche ratchets up the pressure on Illumina; analytical view

If there is an axiom to describe Swiss drug major Roche (ROG: SIX), it is that what Roche wants, it gets, says Jerry Isaacson, head of the GlobalData health care industry dynamics team, commenting on the ongoing sage of the hostile takeover activities regarding USA-based Illumina (The Pharma Letters passim).

Dr Isaacson recalls that Roche bought a majority stake in Genentech in 1990 and decided in 2008 that they wanted the rest of the company. In July 2008, Roche offered $43.7 billion for the 44% of Genentech that it did not already own. Roche went hostile in January of 2009, cutting its bid to $42.5 billion, but eventually relented and paid $46.8 billion in March 2009.

The final price represented a 10% premium over the January bid. Genentech investors initially balked at the takeover, but Roche held strong in its commitment. Eventually, it sweetened the deal for Genentech investors, but one way or another Roche was not going to let go until it had full control of its target.