Affymetrix Rejects a Rival Bid to Thermo Fisher's Merger Plan -- 2nd Update
March 28 2016 - 7:10PM
Dow Jones News
By Ezequiel Minaya
Affymetrix Inc. said Monday that it rejected an unsolicited
buyout bid submitted by a group of the company's former executives
and would continue to back a proposed acquisition by Thermo Fisher
Scientific Inc.
In response, Origin Technologies Corp., a newly formed entity
owned by the former Affymetrix executives, said it is dropping its
acquisition bid but disagrees with Affymetrix over the latter's
assessment of the risk attached to the Origin proposal.
Affymetrix's board said it determined that the buyout bid by
Origin Technologies wasn't a superior proposal as "defined in
Affymetrix's merger agreement with Thermo Fisher Scientific
Inc."
Shareholders of Affymetrix are expected to vote on the Thermo
Fisher offer on Thursday.
Origin last week increased its all-cash offer to $17 a share,
valuing Affymetrix at about $1.58 billion and trumping its previous
offer of $16.10 a share. In January, Thermo Fisher agreed to buy
Affymetrix for about $14 a share, or roughly $1.3 billion, in a bid
to boost its biogenetic-analysis portfolio. The Thermo deal offered
a 52% premium to Affymetrix's stock price before the
announcement.
Affymetrix said Monday that though Origin had a higher offer,
"the board found the risks to initiating and consummating a
potential transaction with Origin outweighed the potential
benefit," according to the news release announcing Affymetrix's
decision.
Among the perceived risks were the ability to secure third-party
financing as well as obtain the needed approvals by regulators in
China and the U.S.
In addition to disagreement with Affymetrix's assessment of
perceived risk, Origin also said that Affymetrix made an
unreasonable demand during negotiations, asking that Origin "place
hundreds of millions of dollars in a U.S. escrow account" by
Monday.
Thermo Fisher, in a separate statement, said it was pleased with
the decision by the Affymetrix board and that it was confident
Affymetrix stockholders would vote in favor of the deal.
Shares of Affymetrix fell 5.6% to $14.10 on Thursday, while
Thermo Fisher dropped 49 cents to $138.53.
Write to Ezequiel Minaya at Ezequiel.Minaya@wsj.com
(END) Dow Jones Newswires
March 28, 2016 18:55 ET (22:55 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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