Roche+Genentech: will the marriage be postponed? - December 02, 2008
Posted for Heidi Ledford
Nervous Genentech employees can stop eyeing the door -- for a little while at least. Swiss pharmaceutical giant Roche, which announced its intention to acquire the California biotech in July, may not be able to get that $45 billion loan it has asked for to complete the offer, according to Reuters.
While the financial crisis has left tiny biotechs gasping for air, big pharma with its big reservoirs of cash is predicted to fare relatively well. But even the mighty Roche doesn’t have $43.7 billion* lying around, and according to a few anonymous but seemingly well-placed sources talking to Reuters, no bank is likely to lend it to them in the current economic morass.
That doesn’t mean that Roche’s bid is over – they’ll just have to work a little harder to raise the funds, possibly by selling corporate bonds. Roche, meanwhile, has pledged as recently as last week that its pursuit of Genentech is on track. But just a day earlier, Pharmalot entertained a little speculation that Roche may have scrapped plans for a swanky new helix-shaped, $450 million R&D center in Basel amid concerns over how the company would finance the Genentech takeover. And remember, at the end of it all, Genentech wanted more than $43.7 billion anyway.
* How big a loan Roche wants is unclear. The offer for Genentech is $43.7 billion but a loan of $45 billion is often mentioned.
Image: Punchstock
