Roche throws in the towel

SAN DIEGO—The months-long saga of Roche's attemptedacquisition of Illumina Inc. came to an end April 18 following Illumina'sannual meeting at which the company's stockholders voted to reject Roche'snominees and associated proposals.

Roche's efforts began in January with a tender offer of$44.50 per share in cash for all of Illumina's outstanding shares, an offerthat was set to expire at midnight on Feb. 24. The company also announced thatit would be presenting several nominees for election to Illumina's board at theSan Diego-based company's annual meeting. When Illumina decried the offer as"grossly inadequate" and only an approximate 102,165 shares had been tenderedto the offer by Feb. 24, Roche extended the offer to March 23, then again toApril 20 when minimal stockholder interest only increased the number of sharestendered to approximately 144,208. In keeping with insistence from bothIllumina and analysts that the $44.50 per share offer was too low, Rocheincreased the offer to $51 per share, for a total of nearly $6.5 billion.

Preliminary voting results released by Illumina on April 18stated that its stockholders had voted to reelect all four Illumina nominees tothe board of directors and to reject all of Roche's proposals, negating Roche'shopes of pushing the offer through by way of gaining a controlling majority ofIllumina's board and leading to its announcement that it would not be extendingits offer past the April 20 expiration date.

"We continue to hold Illumina and its management in veryhigh regard, but with access only to public information about Illumina'sbusiness and prospects, we do not believe that a price above … $51 per sharewould be in the interest of Roche's shareholders," Severin Schwan, CEO ofRoche, said in a statement. "We have throughout this process desired to engagein a constructive dialogue with Illumina's management, listen to its views ofvalue and prospects and offer a fair and adequate price to Illumina'sshareholders. But in the absence of such discussions, our duty to bedisciplined with the assets of Roche's shareholders has led to this decision.Roche will continue to consider options and opportunities to develop furtherits portfolio of businesses in order to expand its diagnostics leadershipposition."

Jay T. Flatley, Illumina's president and CEO, thanked hiscompany's shareholders in a press release for their "confidence in our abilityto execute our strategic plan and create compelling value."

"We are pleased that Roche has decided not to extend itsinadequate offer to acquire Illumina and that we can now return our full focusto growing our business, making the most of the expanding opportunities in ourspace and delivering superior results for our customers and stockholders," saidFlatley.