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On Wednesday pharma investors were trying to figure out if a nearly $6 billion dollar deal was about to go down in flames. That was the chatter after Illumina rejected a takeover offer from Roche saying the bid was inadequate and that it would be more successful on its own.
Illumina - which has already adopted a "poison pill" defense strategy - told shareholders not to tender any of their shares to Roche, saying the offer was grossly inadequate; that it failed to properly value its unique leadership position and future growth prospects. Also Illumina said the timing was unfair to shareholders.Roche, which offered to pay $44.50 per share when it launched the bid for Illumina last month, reiterated on Wednesday that it believed its offer was "full and fair" and that it was ready to start discussions with Illumina.
Is the deal dead on arrival? Although it may sound that way on the surface, trader Karen Finerman says in these situations it’s important to parse through the language used in their response. And she thinks the semantics used were selected intentionally. Here’s her breakdown: Buzzword Translation
Illumina: ‘offer grossly inadequate’ ‘just say no’ defense
Illumina: ‘inopportune time’ not for sale right now
Illumina: ‘we’re unique’ pay up!
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