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Roche makes hostile bid for Ventana

Roche has made a hostile bid to buy US diagnostics firm Ventana Medical Systems for around USD3bn (EUR2.2bn/GBP1.5bn), less than a week after it acquired NimbleGen, a company which deals with high-density DNA microarrays.

Roche has made a hostile bid to buy US diagnostics firm Ventana Medical Systems for around USD3bn (EUR2.2bn/GBP1.5bn), less than a week after it acquired NimbleGen, a company which deals with high-density DNA microarrays.

Roche says it will make a tender offer to acquire all outstanding shares of common stock of Ventana, a leader in the fast-growing histopathology (tissue-based diagnostics) segment, for USD75 per share in cash. This offer represents a 44 per cent premium to Ventana's close of USD 51.95 on June 22 2007 and a 55 per cent premium to its three-month average of USD48.30.

Roche wants to acquire Ventana as it will allow Roche to broaden its diagnostic products and complement its in-vitro diagnostic systems and oncology therapies.

Roche claims it "made multiple efforts to engage in meaningful discussions with Ventana's chairman and board concerning a negotiated transaction; however, as Ventana has so far declined to enter transaction discussions, Roche has decided to commence a tender offer. Roche remains willing to discuss a negotiated transaction agreed to by both parties, as this continues to be Roche's preferred option."

Ventana has responded by advising its shareholders to take no action. "The company's board will review and consider Roche's offer and, following the commencement of the tender offer, will make a recommendation to shareholders within 10 business days," said the company in a statement.

Ventana employs around 950 people and reached sales of USD238.2m in 2006. The 1bn US dollar tissue-based testing market is growing at 10 per cent annually, twice the rate of the overall in-vitro diagnostics market.

Roche says the company will be part of its diagnostics division and will retain the company's headquarters in Arizona in the US.

"The offer will be subject to customary conditions, including the tender of a majority of Ventana's shares of common stock, on a fully diluted basis and Ventana's Board taking all necessary actions to make its shareholder rights plan inapplicable to Rocheís offer," says Roche.

27th June 2007

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