Roche plans cash tender offer for Genentech shares; Genentech urges shareholders to hold off

By Devika Patel

Knoxville, Tenn., Jan. 30 - Roche Holding AG said it intends to commence a cash tender offer for all of Genentech, Inc.'s outstanding publicly held shares at $86.50 per share.

Roche, which owns 55.8% of the Genentech shares, expects to begin the tender offer within approximately two weeks.

The offer replaces Roche's public proposal to acquire all of Genentech's publicly held shares at $89.00 apiece in cash, which was made on July 21, 2008.

Genentech rejected that proposed merger on Aug. 13.

In response to Friday's announcement, Genentech's board of directors urged shareholders to take no action at this time. It said the special committee will take a formal position within 10 business days following the commencement of such a tender offer.

The special committee reiterated that on Aug. 13, after careful consideration, it had unanimously concluded that the $89.00-per-share proposal from Roche substantially undervalued the company.

"Notwithstanding current market conditions, the special committee continues to believe that $89.00 substantially undervalues the company," Dr. Charles A. Sanders, chairman of the special committee of Genentech's board, said in a press release.

Roche is a Basel, Switzerland, pharmaceutical company.

Genentech is a South San Francisco, Calif., biotechnology company.

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