Credit crisis makes Roche bid uncertain

Swiss industry analysts have expressed doubts as to whether local drug major Roche can now acquire US biotechnology giant Genentech of the USA on acceptable terms.

The deal, which would be one of the largest in drug sector history, was originally announced in July and rejected the following month (Marketletter August 18). The South San Francisco-based firm turned down the $43.7 billion offer from Roche for the 44% stake it does not already own at $89 per share.

Three investment banks now believe Roche will have problems because of the international economic crisis and its need to obtain fresh credits. One source in Zurich said that "the market for takeover funding is dead," given that the banks themselves cannot refinance in current conditions.