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February 9, 2009
How Long Is Roche Prepared to Wait?
Posted by Derek
So, here’s a question for you: just how long is Roche going to keep their offer open for Genentech? They left their friendly-in-retrospect offer on the table for quite a while, until it was clear that nothing was going to happen. So how long are they prepared to wait? They say that there's no set date, which is a bit odd.
These tender offers generally have some sort of deadline on them, to spur shareholders into action. People have to sit down and think about it: well, is this a fair deal or not? Should I take the offer, turn it down, hold out for a better price as the deadline gets closer? And there’s also the moving-target problem. Stock prices are nothing if not fluid (“The market, sir, will fluctuate!” as J. P. Morgan put it), and that $86.50 price may well look a bit silly (in either direction) after it’s hung out there on the clothesline for a few weeks.
And the longer things go, the more expensive a deal could be. As the Wall Street Journal points out, Roche could end up issuing bonds to pay for a deal that it hasn't even done yet. What happened to those careful, cautious Swiss?
Comments (5)
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1. Sili on February 9, 2009 2:03 PM writes...
Are you familiar with Ovation Pharmaceuticals? Apparently Lundbeck has just bought them for around 5000 million USD.
Permalink to Comment2. Hap on February 9, 2009 2:12 PM writes...
Don't they have until results for Genentech's new drug come out (or slightly before)? If the results are positive, Roche's offer won't be near enough, and if it's negative, Roche would be paying way more than they needed to.
I wonder how many SEC people will be watching Genentech and Roche stock trades when (or shortly before) the news arrives?
Permalink to Comment3. syregnask on February 10, 2009 4:12 AM writes...
@ Sili: I think the number was more like 900 million USD.
Permalink to Comment4. Sili on February 10, 2009 2:54 PM writes...
D'Oh!
I meant to write 1000 since it's 5000 DKK. But I forgot while trying to awoid using "billion". Sorry.
Permalink to Comment5. Greg House on February 11, 2009 1:56 PM writes...
We hope to really find a cure and that is long, say the same thing and so far many people still suffer and can not find any solution, something that is fast and effective because the pain of this disease is unbearable, I read about this page findrxonline.com and interesting information I think we can give adequate information for people who need it.
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