By Cristal Cody
New York, Jan. 27 - Roche is expected to gain the bank financing needed to buy out the remaining 44% of shares of Genentech Inc. it does not hold and come back with a bid target at $95.00 a share, an analyst told Prospect News on Tuesday.
Also on Tuesday, investors liked the $16.00-a-share offer from Astellas Pharma Inc. for CV Therapeutics Inc., but the bid probably needs to be increased to get any serious board notice, an analyst said.
In other deal action on Tuesday, a judge set March 9 as the trial date for Rohm & Haas Co.'s lawsuit to force Dow Chemical Co. to complete its $15.4 billion takeover of the company, which was required to close on Tuesday.
On Wall Street, the markets caught a break.
The Dow Jones Industrial Average rose 58.70 points, or 0.72%, to 8,174.73.
The broader indexes also advanced. The S&P 500 index gained 9.14 points, or 1.09%, to close at 845.71, and the Nasdaq Composite index rose 15.44 points, or 1.04%, to 1,504.90.
Roche expected to up bid
Roche bid $43.7 billion, or $89.00 a share, for the Genentech shares in July, but the company turned the offer down as too low.
If data from Genentech's cancer drug, Avastin, is positive when it's released in April, it could push the company's value up to $100.00 a share, said Christopher James, a senior analyst with Rodman & Renshaw LLC.
Shares of Genentech rose $1.55, or 1.90%, to $83.14 Tuesday.
"We have increased confidence the deal gets done around the $95.00 premium," James said. "It's hard to handicap, but we're saying sometime round mid-2009 we think Roche will become increasingly aggressive."
Astellas pushes CV Therapeutics offer
Tokyo-based Astellas Pharma released its offer for CV Therapeutics to the public on Tuesday after rebuffs from the company's board.
And the public liked it. Shares of CV Therapeutics closed up $4.07, or 35.86%, at $15.42 Tuesday.
The offer is a 41% premium to CV Therapeutics' closing share price on Monday.
Astellas Pharma first made the offer to the board on Nov. 14.
According to a market source, CV Therapeutics' shareholder rights plan expires on Feb. 1.
"We are disappointed that the CV Therapeutics board of directors has rejected outright what we believe is a very compelling all-cash proposal that would deliver stockholders significant immediate value that we believe far exceeds what CV Therapeutics can achieve as a standalone company," Masafumi Nogimori, president and chief executive officer of Astellas, said in a statement.
Representatives of Palo Alto, Calif.-based CV Therapeutics were not immediately available for comment.
Derek Taller, an analyst with the Benchmark Co., said the company's board is not likely to sell.
"They rejected this offer before. I would think nothing's changed," said Taller, who has a $19.00 target price on the stock.
"I don't think people appreciate [that CV Therapeutics] acquired the rights to Asia so there is greater prospect for growth as well," he said. "I think they're wanting a better offer."
Rohm & Haas court date set
Rohm & Haas expected Dow Chemical to close the $15.4 billion takeover on Tuesday.
Dow Chemical CEO Andrew Liveris said the company could need until June to set up financing to complete the $78.00-a-share deal.
A Delaware Chancery Court judge set the trial date in Rohm & Haam's lawsuit, which was filed on Monday to force Dow Chemical to close the merger.
Shares of Rohm & Haas rose $1.65, or 2.89%, to close at $58.75 Tuesday.
Dow Chemical's stock dropped a nickel, or 0.38%, to $13.19 in trading.
Mentioned in this article:
Astellas Pharma Inc. Pink Sheets: ALPMY
CV Therapeutics Inc. Nasdaq: CVTX
Dow Chemical Co. NYSE: DOW
Genentech Inc. NYSE: DNA
Rohm & Haas Co. NYSE: ROH
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