Laboratory News

Roche Takes Ventana as the Prize Upon Completing Tender Offer

It’s been a long and difficult path for Roche Holdings, AG  (VTX:ROG.VX) in its effort to acquire Ventana Medical Systems Inc.  (NasdaqGS:VMSI). However, earlier this week, on Tuesday, February 19, both Roche and Ventana announced that Roche had completed its tender offer for the outstanding shares of Ventana. Rocket Acquisition Corporation, a wholly owned subsidiary of Roche, purchased approximately 34,545,323 shares of Ventana common stock, representing approximately 93.7% of Ventana’s outstanding shares.

Roche stated that it “expects to complete the acquisition of Ventana today through a short-form merger, without a vote or meeting of Ventana’s shareholders. In the merger, all of the shares of Ventana not owned by Roche and its subsidiaries (other than shares as to which appraisal rights are validly exercised) will be converted into the right to receive the same cash consideration that was paid in the tender offer. Following the merger, Ventana’s common stock will cease to be traded on the NASDAQ Global Select Market.”

As of the close of business yesterday, Thursday, Roche had made no further announcement confirming the completion of its acquisition of Ventana Medical Systems. VMSI is no longer listed on the NASDAQ Global Select Market.

For Franz B. Humer, Chairman and CEO of Roche, the acquisition was a done deal. On Tuesday, he said, “We are happy to officially welcome Ventana’s employees to the Roche Group and will begin the integration of our businesses immediately… Incorporating Ventana will enhance our position as the world’s leading, personalized healthcare company.”

Regular readers of Dark Daily have tracked the battle between Roche and Ventana since last June, when Roche initiated a hostile tender offer for Ventana. By that time, Roche had spent 12 fruitless months attempted to discuss an acquisition with Ventana. It had been rebuffed each time, despite the offer of a purchase price of $3 billion, which surprised and impressed Wall Street analysts. In 2006, Ventana posted sales of $238.2 million.

Experts have noted that Roche believes Ventana’s molecular markers will make a good fit for its therapeutic drugs and will help Roche further develop the market for personalized medicine. Ventana has an assay for Her2Neu that can help determine whether a patient is a candidate for Herception, which is Roche’s second best-selling therapeutic drug. Further, Roche Diagnostics is a global player in molecular diagnostics. Ventana’s products for specimen preparation and automated systems for histology laboratories will dovetail nicely with Roche’s molecular tests and instrument systems.

For the laboratory industry, Roche’s willingness to pay a premium price for Ventana shows that molecular diagnostics continues to be a hot growth sector in laboratory medicine. It also demonstrates that consolidation among in vitro diagnostics (IVD) companies is an ongoing trend.

Related Information:

• Roche to Acquire Ventana for $89.50 per share.
• Roche/Ventana Deal Could Unravel
• Roche’s Higher Offer Wins Ventana After Seven Months