Roche chairman pooh-poohs another Illumina bid

Roche Chairman Franz Humer--courtesy of Roche.

If you've been rooting for Roche ($RHHBY) to make another run at the gene sequencing company Illumina ($ILMN), you could be in for a disappointment. The drugmaker's chairman, Franz Humer, told a Swiss newspaper that an Illumina deal "is definitively off the table."

But that all depends on what the definition of "definitively" is. Humer's comments could be interpreted as a negotiating ploy. They certainly left the door open for a "Price Is Right" bid at a later date.

"The other side wasn't ready to retreat from their totally excessive price demands," Humer told SonntagsZeitung (as quoted by Bloomberg). "Roche doesn't do acquisitions that don't create added value. We have self-discipline."

That was something Illumina investors didn't want to hear. The stock had dropped the most in 15 months this morning, to $49.99 at about 10 a.m. Ever since Roche filed its first bid for Illumina last April, investors have been hoping for another offer--and a Swiss newspaper raised the prospect in December--so the Nein with a Bern dateline was a blow.

Still, although Humer emphasized that Roche has other gene-sequencing alternatives for building up its targeted drugs and diagnostics business, analysts see potential for another Illumina bid. If not from Roche, then from someone else. "We do not believe this precludes Roche from returning to Illumina as a targeted asset in the future," ISI Group analyst Ross Muken wrote in an investor note, "and does not diminish its attractiveness as a potential M&A target."

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