Roche sells Genentech stock for $1.94 billion

Following its purchase of all the outstanding stock of Genentech lastmonth, Roche has publicly offered 20 million of the latter's common stock at a price of $97 per share, thus raising a gross $1.94 billion.

Roche recently exercized its option to redeem all outstanding special common Genentech shares not already owned at $82.50 per share (Marketletter June 7), according to the terms of the agreement it reached with the US biotechnology company in 1990 and renegotiated in 1995.

The underwriters of the offering have an option to buy an additional 2 million shares to cover over-allotments. If this happens, Roche will continue to own around 82.7% of Genentech and will raise a total of $2.1 billion. The first trading day for Genentech shares was July 20.