Genentech rejects Roche's tender offer, urges shareholders to do the same

By Lisa Kerner

Charlotte, N.C., Feb. 23 - The special committee of Genentech, Inc.'s board of directors unanimously recommended that shareholders not tender their shares in Roche Holding AG's $86.50-per-share offer.

"Genentech's strong projected financial performance implies a valuation substantially in excess of Roche's offer price," Dr. Charles Sanders, chairman of the board's special committee, said in a company news release.

Roche began the tender offer on Feb. 9. It is set to end at midnight ET on March 12.

According to Roche, the offer replaces its July 21, 2008 proposal to acquire the Genentech shares for $89.00 apiece in a negotiated merger, which Genentech rejected.

According to Sanders, despite Genentech's willingness to "work constructively" with Roche, the Basel, Switzerland, pharmaceutical company refused to increase its original $89.00 offer and to "engage in productive negotiations."

The $86.50-per-share offer price, like the original $89.00-per-share offer, "substantially undervalues" the South San Francisco, Calif., biotechnology company, Genentech said.

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