M&A Recap: Roche Gets Hostile, KIT Digital Rockets

The Roche (RHHBY) – Illumina (NASDAQ:ILMN) takeover drama sharpens Thursday as the former raises its hostile offer to the latter’s shareholders by 15 percent to $51 a share, or approximately $6.7 billion, but so far the investors see the offer as ‘lowball’. Baillie Gifford, Illumina’s second largest shareholder with 11 percent, is especially opposed to the deal. Further, Illumina shares closed Wednesday more than $5 higher than Roche’s initial bid of $44.50. According to inside sources, Roche could raise its bid higher if Illumina would agree to talks with its would-be buyer.

Investing Insights: Roche Ups the Ante With Latest Illumina Bid.

India’s largest beer company, United Breweries, could become Heineken’s (HINKY) if that company purchases another 13 percent, for $370 million. United’s owner, Vijay Mallya is seeking capital in order to keep Kingfisher Airlines a going concern, so the possibility of such a deal exists.

Collective Brands (NYSE:PSS), which owns shoe stores Payless and Stride Rite, is on the shopping list of South Korean retailer E-land, according to a business newspaper in that country, and shares respond positively in early trading. E-land is reportedly nearing an offer of $1.8 billion for Collective, which announced last summer its intentions to shut under-performing stores and perform a strategic evaluation.

Two pharmacy groups and nine retail pharmacy companies are filing a lawsuit in Federal court to block the ongoing merger of Express Scripts (NYSE:ERX) and Medco (NYSE:MHS). The drug majors expect their $29.1 billion deal to close nest week, however, and an expert in such cases says that if the government allows the merger, the lawsuit will face quite an uphill battle.

A sale of KIT Digital (NASDAQ:KITD) may well be “underway”, says Roth Capital analyst Richard Ingrassia, who has investigated the situation with sources and executives. A list of possible suitors includes IBM, Cisco, Accenture, and Alcatel-Lucent, plus a slew of private equity firms.

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To contact the reporter on this story: Mark Lawson at staff.writers@wallstcheatsheet.com

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