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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
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Washington,
D.C. 20549
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SCHEDULE
TO
(RULE
14d-100)
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Tender
Offer Statement under Section 14(d)(1) or 13(e)(1) of
the
Securities Exchange Act of 1934
(Amendment
No. 2)
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GENENTECH,
INC.
(Name
of Subject Company (Issuer))
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ROCHE
INVESTMENTS USA INC.
(Offeror)
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an
indirect wholly owned subsidiary of
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ROCHE
HOLDING LTD
(Parent
of Offeror)
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(Names
of Filing Persons (identifying status as offeror, issuer and other
person))
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Common
Stock, Par Value $0.02 Per Share
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(Title
of Class of Securities)
368710406
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(Cusip
Number of Class of Securities)
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Roche Investments USA
Inc.
1220 N. Market Street, Suite
#334
Telephone: (302) 425-0151
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(Name,
Address and Telephone Number of Person Authorized to Receive
Notices
and
Communications on Behalf of Filing Persons)
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Copies
to:
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Telephone:
+41-61-688-1111
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Telephone:
(212) 450-4000
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CALCULATION OF FILING
FEE
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Transaction
Valuation*
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Amount of
Filing Fee**
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$42,056,058,888.50
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$1,652,803.11
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*
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Estimated for purposes of calculating
the filing fee only. Calculated by adding (i) the product of
(A) 464,844,149, which is
the difference
between 1,052,033,529, the number
of shares
(“Shares”) of common stock of Genentech, Inc.
outstanding as of September 30, 2008, and 587,189,380, the number of Shares beneficially
owned by Roche
Holding Ltd and (B) $86.50, which is the per Share tender offer price, and (ii)
the product of (A)
76,800,000, which is the number of
Shares subject to “in-the-money” options outstanding as of
September 30, 2008,
and (B) $24.05, which is the difference
between the
$86.50 per Share tender offer price and
$62.45, the average weighted exercise price of such
options. The number of outstanding Shares, the number of Shares subject to “
in-the-money” options and the average weighted exercise price
for such options is contained in
Genentech’s Quarterly Report on
Form 10-Q for the quarter ended September 30, 2008.
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**
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The amount of the filing fee is
calculated in accordance with Rule 0-11 of the Securities Exchange
Act of 1934, as
amended, and Fee Rate
Advisory #
2 for Fiscal Year 2009 issued by the Securities and
Exchange Commission on September 29, 2008, by multiplying the transaction
valuation by 0.0000393.
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þ
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Check box if any part of the fee
is offset as provided by Rule 0-11(a)(2) and identify
the filing with which the offsetting fee was previously
paid. Identify the previous filing by
registration statement number, or the Form or Schedule and the date of
its
filing.
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| Amount Previously
Paid: |
$1,652,803.11 |
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Filing
Party: |
Roche Investments
USA Inc./Roche Holding Ltd |
| Form or Registration
No.: |
Schedule
TO-T |
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Date
Filed: |
February 9,
2009 |
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o
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Check the box if the filing
relates solely to preliminary communications made before the commencement of a
tender offer.
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Check the appropriate boxes below to
designate any transactions to which the statement relates:
þ third-party tender offer subject to Rule
14d-1
o issuer tender offer subject to Rule
13e-4
þ going-private transaction subject to Rule
13e-3
o amendment to Schedule 13D under Rule
13d-2
Check the following box if the filing is
a final amendment reporting the results of the tender offer. o
This Amendment No. 2 amends and supplements the Tender Offer Statement and Rule 13E-3 Transaction
Statement
originally filed under
cover of Schedule TO
on February 9,
2009 and as previously
amended and supplemented (as previously amended and supplemented, the “Schedule TO”) by Roche Holding Ltd, a joint stock
company organized under the
laws of Switzerland
(“Parent”), and Roche Investments USA Inc., a
Delaware corporation and an indirect wholly owned subsidiary of Parent (the
“Purchaser”). The Schedule TO relates to the offer
by the
Purchaser to purchase all outstanding shares of common stock, par value
$0.02 per share (the “Shares”), of Genentech, Inc., a Delaware
corporation (the “Company”), not owned by Parent and its subsidiaries at $86.50 per Share upon the terms and subject to
the conditions set forth in the Offer to Purchase, dated February 9, 2009 as amended and supplemented (the “Offer to
Purchase”), and in the related Letter of
Transmittal (which,
together with any amendments or supplements thereto, collectively constitute the
“Offer”).
All capitalized terms used in
this Amendment No.
2 without definition have the meanings
ascribed to them in the Schedule TO.
The items of the Schedule TO set forth
below are hereby amended and supplemented as follows:
Items 1 through 9, 11 and 13.
(1) The following paragraph:
“Our obligation to consummate the offer
is subject to obtaining sufficient financing to purchase all outstanding shares
of Genentech common stock not owned by the Roche Group and all shares of
Genentech common stock issuable upon exercise of outstanding options and to pay
related fees and expenses. Based on the $86.50 per share offer price,
we estimate that we will need approximately $42.1 billion to purchase all
outstanding shares not owned by the Roche Group (including all shares issuable
upon exercise of outstanding options) and to pay related fees and
expenses. We have raised net proceeds of approximately $36 billion through
a series of debt offerings. We expect to obtain the remaining funds
through a combination of additional debt financing, which could include private
placements of notes, commercial paper and borrowings under our existing €2.5
billion revolving credit facility or under additional facilities, and the use of
available cash held by the Roche Group. We will only be able to consummate
the offer if we have obtained sufficient financing.”
replaces
each of the following in their entirety in the Offer to Purchase: (a) the paragraph in the “Summary Term Sheet” of the Offer to Purchase under the
caption, “Do you have the
financial resources to pay for the shares?;” and (b) the information in the
Offer to Purchase under “The Offer — Section 10 — Source and Amount of
Funds.”
(2) The following sentences:
“Roche
will determine what actions to pursue following the completion of the offer
based on an analysis of all relevant facts, including the number of shares of
Genentech common stock then owned by the Roche Group, the market price of the
shares and Roche’s assessment of the feasibility, cost and potential risks and
benefits of its various options, Roche’s fiduciary duties under Delaware law,
the applicable provisions of the Affiliation Agreement and whether Roche can
reach an agreement with the special committee with respect to a second-step
transaction. No assurance can be given as to the price per share that may be
paid in any such future acquisition of Genentech shares or the form of
consideration that may be offered in any such future
acquisition, particularly given that positive or negative business
developments could occur that could have a direct impact on the price or
consideration Roche is willing to pay.”
replace each of the following in their
entirety in the Offer to Purchase: (a) the last sentence in the second paragraph
in the “Summary Term
Sheet” under the caption,
“Will the offer be followed by a merger if all of the shares are not
tendered in the offer?;” (b)
the seventh paragraph (beginning with “If following the consummation of
the Offer the Roche Group does not own 90%….”) under “Introduction;” and (c) the third paragraph (beginning
with “No
assurance can be given
as….”) under “Special Factors —
Section 6 — Effects of the Offer.”
(3) The following sentence:
“No
assurance can be given as to the price per share that may be paid in any such
future acquisition of Genentech shares, the form of consideration that may be
offered in any such future acquisition or the effect any
such
actions could have on trading, particularly given that positive or negative
business developments could occur that could have a direct impact on the price
or consideration Roche is willing to pay.”
replaces each of the following in their
entirety in the Offer to Purchase: (a) the third sentence in the last paragraph
in the “Summary Term
Sheet” under the caption,
“If I decide not to tender, how will the offer affect my shares?;”
and (b) the last sentence under
“Special Factors — Section 7 — Conduct of the Company’s Business If the Offer Is
Not Consummated.”
(4) The
following sentences:
“If the
Roche Group does not own 90% or more of the shares of Genentech common stock
following consummation of the offer, we believe the shares of Genentech common
stock would likely continue to meet the standards for continued listing on the
New York Stock Exchange and Genentech would likely continue to be obligated to
make filings with the Securities and Exchange Commission and comply with the SEC
rules relating to public companies.”
are added to the Offer to Purchase
in each of the following
places: (a) following the fourth sentence in the
first paragraph in the
“Summary Term
Sheet” under the caption,
“If I decide not to
tender, how will the offer affect my shares?;” and (b) following the fourth sentence in the
seventh paragraph (beginning with “The purchase of Shares by the
Purchaser….”) under “Special Factors — Section 6 — Effects of the
Offer.”
(5) The
information in the “Summary Term Sheet” of the Offer to Purchase under the caption, “How does the
Affiliation Agreement affect the offer and any subsequent merger between
Genentech and Roche?” is replaced with the following:
“How does the
Affiliation Agreement affect the offer and
any subsequent transaction in Genentech shares?
The Affiliation Agreement does not
affect the offer.
The Affiliation Agreement does impose
conditions in addition to Delaware law on any merger between
Genentech and us that may occur following consummation of the offer. In connection with any such
merger, either one of the
following two requirements must be met:
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·
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the
merger must receive the favorable vote of a majority of the shares of
Genentech common stock voted at any meeting or adjournment thereof not
beneficially owned by us (with no person or group entitled to cast more
than 5% of the votes cast at the meeting);
or
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·
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in
the event such a favorable vote is not obtained, the value of the
consideration to be received by the public stockholders in the merger must
be equal to or greater than the average of the means of the ranges of fair
values for the shares as determined by two investment banks of nationally
recognized standing appointed by a committee of the Genentech’s
independent directors.
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The Affiliation Agreement further
provides that if we own more than 90% of the outstanding shares of Genentech
common stock for more than two months, we must, as soon
as reasonably practicable, effect a merger with Genentech subject to compliance with one of the above two bullet
points. See
“Special
Factors — Section 6 — Effects of the Offer” and “Special Factors — Section 10 — Related Party
Transactions — Certain Governance
Arrangements — Affiliation Agreement — Business Combinations with
RHI.”
Except as described above with respect
to a merger, the Affiliation Agreement does not affect other potential
acquisitions of shares by us following consummation
of the offer. For example, the Affiliation Agreement does not impose
any additional requirements
or conditions on the purchase of shares by us (including in the open market, privately negotiated
transactions or
a new tender
offer or otherwise).”
(6) The third
and fourth paragraphs in the Offer to Purchase under “Special Factors — Section 1 — Background” are replaced with the
following:
“Over a period of approximately six
months in late 2002 and early 2003, Roche evaluated a range of possible
alternatives with respect to the Company, including:
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·
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pursuing
various governance alternatives (such as adding a non-executive Board
chairman, creating a more active executive committee of the Company’s
board of directors, changing the composition of the compensation committee
so that it was comprised of a majority of Roche representatives,
increasing the size of the board by adding additional independent
directors and/or additional Roche representatives and/or achieving
proportional representation through delivery of a governance
notice),
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·
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entering
into revised or expanded commercial arrangements, joint ventures or other
collaborations,
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·
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increasing
Roche’s share ownership,
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seeking
a cash merger whereby the Company would become a wholly owned subsidiary
of Roche,
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seeking
a stock merger with another part of the Roche
Group,
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reducing
Roche’s ownership of the Company in whole or in
part.
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Ultimately, Roche determined to attempt
to improve the collaboration between the Company and Roche. As part
of these efforts, in late 2003 Roche began discussions with the Company and the
independent directors of the Company’s board of directors regarding the
possibility of Dr. Humer being replaced on the Company’s board of directors by
Mr. Burns and Dr. Hunziker. This would increase Roche’s board
representation, but only to a level that still represented less than a majority
of the board. Following discussions between Roche, the Company and
the independent directors, certain amendments to the Company’s bylaws that,
among other things, permitted Roche to have three (of seven) representatives on
the Board and permitted the Company’s board of directors (by majority vote) to
determine to increase the number of independent directors were submitted for
stockholder approval at the meeting of the Company’s stockholders in April 2004
and, following stockholder approval of the bylaw amendment, Mr. Burns and Dr.
Hunziker were elected to the Company’s board of directors.
In the fall of 2007 Roche gave very
preliminary consideration to a potential transaction whereby Roche would acquire
100% of the Company and then sell to the public a minority interest in a new
research company that would be listed in the US. As an alternative to
this transaction, Roche also gave very preliminary consideration to a
transaction whereby Roche and the Company would contribute assets to create a
new research company that would be owned by Roche and the Company’s public
stockholders. The consideration of these transactions did not progress beyond
the preliminary stages, and Roche ultimately determined in mid-September 2007
not to pursue such transactions.
In late 2007 and early 2008, there were
discussions between representatives of the Company and Roche concerning
amendments to the Commercialization Agreement relating to Roche’s product opt-in
rights, the possibility of adding additional representatives of Roche to the
Company’s board of directors and amendments to the anti-dilution provisions of
the Affiliation Agreement to facilitate purchases by Roche of Shares from time
to time in the open market (and maintenance of Roche at up to an
aggregate of 64% ownership percentage). These discussion were an
ongoing process that from Roche’s perspective ended in April 2008.
In
mid-May 2008, Roche began working with Greenhill as its financial advisor and
Davis Polk & Wardwell as its legal advisor in connection with exploring a
possible going-private transaction. Over the next few months, Roche’s management
held a series of meetings and discussions with its advisors regarding different
approaches. In the end, Roche’s management concluded that a negotiated merger
with the Company would be preferable to other potential structures, such as
making a unilateral tender offer directly to the Company’s stockholders. Roche
chose this approach primarily because it strongly favored a “friendly”
transaction that would build upon the trust and goodwill that Roche has
developed with the Company’s stockholders and employees over the almost 20 years
that Roche has been the Company’s majority stockholder. Roche also
believed that a negotiated merger had the advantage that all public stockholders
would receive the same per Share price in cash. Roche and its
advisors also considered other alternatives in addition to, or in lieu of, a
potential going-private
transaction,
including the possibility of Roche exercising its existing governance rights to
obtain proportional representation on the Company’s board of directors or
otherwise seeking a more active role in the management of the
Company. Roche determined not to pursue any of these other
alternatives and, instead, chose to reserve its right to take such actions in
the future should Roche determine it appropriate to do so.”
(7) The
following replaces the fourth paragraph on page 11 of the Offer to Purchase
under “Special Factors — Section 1 — Background:”
“At the request of Ms. Reed,
Dr. Boyer and
Dr. Sanders, draft resolutions establishing a committee of the
Company’s board of directors composed of
Ms. Reed, Dr. Boyer and Dr. Sanders (the “Special
Committee”) to consider the $89 per Share proposal
were circulated on July 22, 2009. The draft resolutions, fashioned in the form of a
unanimous written consent of the Company’s board of directors, were initially
prepared by counsel to the Special Committee and counsel to the Company and
contemplated the written consent of all the Company’s directors, including Roche’s designees on the
board. Over the course of the next two days, counsel for each of the
Special Committee, the Company and Roche negotiated the scope of the authority
requested by the Special Committee. The resolutions ultimately
adopted by the Company’s board of directors are substantially
in the form initially proposed by counsel to each of the Special Committee and
the Company, with certain limited changes proposed by Roche’s counsel. These changes
primarily relate to the addition of language acknowledging that Roche was not
prepared to sell its Shares and of language making clear that while the
resolutions generally grant the Special Committee authority to take actions with respect to compensation of officers and
employees, the Special
Committee was not authorized to change existing equity grants (other than
providing for acceleration of vesting thereof conditioned upon consummation of a
merger) or make new equity grants (other than new equity grants in the
ordinary course consistent
with past practices and terms pursuant to the Company’s existing Annual Stock Option
Program). In
addition, at the Special Committee’s request, RHI agreed to execute an
acknowledgement that the Roche Group would not have a representative on the
Special Committee,
notwithstanding the provision of the Company’s bylaws that generally affords RHI
proportional representation on committees of the Company’s board of directors. See “Special Factors — Section 10 — Related Party
Transactions — Certain Governance Arrangements — Certificate of Incorporation and
Bylaws — RHI’s Right to Proportional
Representation.”
(8)
The
following replaces the second sentence of the last paragraph on page 13 of the
Offer to Purchase under “Special Factors — Section 1 — Background:”
“On
October 2, 2008, representatives of Greenhill participated in a telephone
conference call with representatives of Goldman Sachs. As part of the
discussions, the Greenhill and Goldman Sachs representatives discussed the
potential use of contingent consideration based on the results of the Company’s
Avastin C-08 clinical trial. The Greenhill representatives indicated
that Roche was skeptical whether contingent consideration could effectively
bridge a large valuation gap, particularly given the low value historically
ascribed to contingent consideration by stockholders as evidenced by the trading
history in precedent transactions. Despite these concerns and in an
effort to be responsive, the Greenhill representatives indicated that they had
discussed the use of contingent consideration with Roche and indicated that
Roche would be willing to consider contingent consideration triggered by the
U.S. Food and Drug Administration approval of Avastin in the adjuvant colorectal
cancer setting. The Greenhill representatives asked Goldman Sachs to
respond with the Special Committee’s view on the viability of that
approach. Neither Goldman Sachs nor the Special Committee responded
to Roche on this matter.”
(9)
The
following sentence is inserted after the fifth sentence of the paragraph on page
14 of the Offer to Purchase that starts with “On November 16, 2008….” under
“Special Factors — Section 1 — Background:”
“An
“adjuvant indication” refers to one or more anti-cancer drugs used in connection
with (and typically after) the primary therapy, usually surgery or
radiation.”
(10)
The
following sentence is inserted after the third sentence of the paragraph on page
15 of the Offer to Purchase that starts with “On January 9, 2009….” under
“Special Factors — Section 1 — Background:”
““Follow-on
biologics” refers to subsequent biologic products that are marketed after
expiration of patents covering pre-existing biologic products and are claimed to
have similar properties to the pre-existing patent protected
products.”
(11)
The
following sentence is inserted at the end of the paragraph on page 15 of the
Offer to Purchase that starts with “On January 9, 2009….” under “Special Factors
— Section 1 — Background:”
““New
molecular entities” are drugs that include an active ingredient that has not
previously been approved for marketing in any form.”
(12)
The
following new paragraph is added after the fourth paragraph (beginning with “In
the early morning in Basel, Switzerland, on January 30, 2009….”) on page 16 of
the Offer to Purchase under “Special Factors — Section 1 — Background:”
“On January 29, 2009, after careful
consideration, Roche’s senior management settled on an $86.50 per Share price to
be paid in the Offer. Roche’s senior management arrived at the $86.50
per Share price in light of a number of factors, with no single factor being
determinative. These factors included the well-documented
global economic dislocations coupled with adverse developments in the credit
markets, the significant decrease in comparable public company valuations, the
decrease in the Company’s enterprise value/EBITDA and P/E multiples since July
2008, an analysis of squeeze-out premiums applied to the Company’s implied
unaffected price, the fact that in the Company’s earnings conference call on
January 15, 2009 the Company lowered its outlook for 2009 and promptly
thereafter research analysts lowered their base financial forecasts on the
Company below July 2008 levels, the strengthening of the U.S. dollar vis-à-vis
the Swiss Franc and the inherent uncertainty associated with an unsolicited
tender offer. Roche determined the Offer price notwithstanding the
increased cash flows described in the November Financial Model, in large part
due to Roche’s skepticism that such forecasts were reasonably achievable given
the inherent uncertainty in estimating out-year cash flows, particularly when a
substantial portion of the value relates to new molecular entities that have not
yet been discovered. For additional information regarding the factors considered
by Roche in formulating the $86.50 per Share price, see “Special Factors —
Section 4 — Summary of Presentation of Greenhill to Roche — Summary of Roche’s
Rationale for Current Offer Price.””
(13)
The
following sentence is inserted at the end of the bullet point captioned “Future Pricing” on page 19 of
the Offer to Purchase under “Special Factors — Section 3 — Position of Roche
Regarding Fairness of the Transaction:”
““Therapeutic
reference pricing” refers to the maximum amount an insurer will reimburse for
any medicine within a group of medicines that treat the same medical
condition.”
(14) The
following is inserted after the first sentence of the bullet point captioned
“Pipeline Productivity” on page 20 of the Offer to Purchase under “Special
Factors — Section 3 — Position of Roche Regarding Fairness of the
Transaction:”
“A
“clinical trial” refers to a research study involving the treatment of humans to
determine whether new drugs or treatments are safe and effective.”
(15) The
following is inserted in the Offer to Purchase before the last sentence of the
first paragraph under “Special Factors — Section 2 — Purpose of and Reasons for
the Offer; Plans for the Company — Plans for the Company:”
“The
Roche Group’s primary focus in acquiring the entire equity interest of the
Company is long-term value creation, not job cutting. However, by
combining certain operations of the Company with the Roche Group, Roche
currently anticipates that combined U.S. employment could be reduced by
approximately 12%.”
(16)
Under
“Special Factors — Section 3 — Position of Roche Regarding Fairness of the
Transaction:”
(a)
The
following is added at the end of the last bullet point on page 18 of the Offer
to Purchase:
“We
believe this factor supports our view as to the fairness of the transaction,
since the uncertainty of not having an agreed transaction decreases the value of
the acquisition to Roche and, therefore, the price Roche is willing to
pay.”
(b)
The
following is added as a new third sub-bullet point under the first full bullet
point on page 19 of the Offer to Purchase:
“Roche
believes that the severe economic developments described above, coupled with the
passage of over six months of attempted negotiations with the Special Committee,
justify a decrease in the initial $89 per Share price and support our view as
the fairness of the Offer Price because (a) Roche believes the Company’s
prospects and valuation have declined, making the Company less valuable than
before, and (b) Roche’s transaction costs have increased materially, making the
transaction more expensive.”
(c)
The
following is added at the end of the third full bullet point (beginning with “The Offer Price reflects the fact the
fact….”) on page 19 of the Offer to
Purchase:
“We
believe this factor supports our view as to the fairness of the transaction
because Roche has effectively agreed to share with the unaffiliated stockholders
of the Company the benefit of an additional $300 to $340 million in synergies
that Roche expects to realize whether or not the transaction is
consummated.”
(d)
The
following is added at the end of the fourth full bullet point (beginning with “The November Financial
Model….”) on page 19 of the Offer to
Purchase:
“We
believe that each of the following factors supports our view as to the fairness
of the transaction since each demonstrates that the June LRP Summary is in
Roche’s view a more reliable indicator of the Company’s long-term prospects as
compared to the November Financial Model, and it is therefore appropriate for
Roche to base its valuation on an analysis of the June LRP Summary instead of
the November Financial Model.”
(e)
The
following is added at the end of the bullet point captioned “Manufacturing Excess
Capacity” on page 21 of the Offer to Purchase:
“We
believe this factor supports our view as to the fairness of the transaction for
two reasons. First, we believe it further demonstrates that the
November Financial Model is overly optimistic. Second, we believe it
would be inappropriate not to take the Company’s excess capacity costs into
account in valuing the Company, given that the reduction of these costs have
been factored into the expected synergies Roche used to formulate the
Offer.”
(f)
The
following is added as a new fourth sub-bullet point under the first full bullet
point on page 22 of the Offer to Purchase:
“We
believe this factor supports our view as to the fairness of the transaction
because in our view it further demonstrates that the November Financial Model is
overly optimistic, and it is therefore more appropriate for Roche to base its
valuation on an analysis of the June LRP Summary instead of the November
Financial Model.”
(g)
The
following is added at the end of the second full bullet point (beginning with “By providing the Company’s stockholders unaffiliated….”) on page 22 of the Offer to
Purchase:
“We
believe this factor supports our view as to the fairness of the transaction
since the Offer effectively gives the Company’s stockholders the choice in the
Offer to either tender at a price based on the risk-adjusted, probability
weighted outcome of positive clinical trial results or not tender and be subject
to the full risk, but also the full benefits, of actual clinical trial
results.”
(17)
The
following is inserted in the Offer to Purchase after the eleventh bullet point
on page 20 (beginning with “The Company’s basic development costs….”) under
“Special Factors — Section 3 — Position of Roche Regarding Fairness of the
Transaction:”
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“
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Ÿ
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The
table below sets forth the development costs assumed by the November
Financial Model, those assumed by Roche and the variance between the two
assumptions:
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($
in millions)
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Phase
0
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$22
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$6
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$11
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$6
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$11
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($0)
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Phase
1
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27
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29
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27
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29
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(0)
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(0)
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Phase
2
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49
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30
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64
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69
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(15)
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(39)
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Phase
3
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133
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142
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307
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307
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(174)
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(165)
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| |
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Total
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$231
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$207
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$409
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$412
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($178)
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($205)
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”
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(18)
Under
“Special Factors — Section 4 — Summary of Presentation of Greenhill to Roche —
Summary of Roche’s Rationale for Current Offer Price:”
(a) The
second sentence (beginning with “Greenhill noted:….”) in the Offer to Purchase
under “Special Factors — Section 4 — Summary of Presentation of Greenhill to
Roche — Summary of Roche’s Rationale for Current Offer Price” is replaced with
the following:
“Greenhill
noted that Roche considered several factors in determining the $86.50 per share
Offer price, with no single factor being determinative. The
determination of the Offer price involved significant business judgments by
Roche and was based on the evaluation of the following key factors:
(b)
The
following is added to the Offer to Purchase at the end of the first bullet point
under “Special Factors — Section 4 — Summary of Presentation of Greenhill to
Roche — Summary of Roche’s Rationale for Current Offer Price” before the
semicolon:
“. These
severe economic developments, coupled with the passage of over six months of
attempted negotiations with the Special Committee, in Roche’s view justify a
decrease in the initial $89 per Share price as (a) Roche believes the Company’s
prospects and valuation have declined, making the Company less valuable than
before, and (b) Roche’s transaction costs have increased materially, making the
transaction more expensive”
(c)
The
following is added to the Offer to Purchase at the end of the sixth bullet point
(beginning with “the review conducted by Roche
revealed….”) under “Special Factors —
Section 4 — Summary of Presentation of Greenhill to Roche — Summary of Roche’s
Rationale for Current Offer Price” before the semicolon:
“. For
instance, Roche believes (a) the competitive pricing environment does not
support the Company’s robust assumptions regarding future price increases, (b)
the CATT trial results could lead to significant declines in Lucentis sales, (c)
additional PML cases in Raptiva patients may have a materially negative impact
on Raptiva cash flows and (d) the Company’s pipeline productivity assumptions
are overly optimistic”
(d)
The
following is added to the Offer to Purchase at the end of the seventh bullet
point (beginning with
“credit spreads have
widened
noticeably….”) under “Special Factors —
Section 4 — Summary of Presentation of Greenhill to Roche — Summary of Roche’s
Rationale for Current Offer Price” before the semicolon:
“. For
example, to finance its acquisition of Wyeth, Pfizer had to pay 7% to 9%
interest rates on a one-year bank facility and agree to an unusual provision
giving its lenders an “out” if Pfizer’s credit rating declines past certain
thresholds”
(e)
The
following is added to the Offer to Purchase at the end of the eighth bullet
point (beginning with “the U.S. dollar has
strengthened….”) under “Special Factors —
Section 4 — Summary of Presentation of Greenhill to Roche — Summary of Roche’s
Rationale for Current Offer Price” before the semicolon:
“. When
Roche made its initial proposal, the CHF / USD exchange rate of 1.023 was cited
by Roche and analysts as important to the transaction, as it lowered Roche’s
effective purchase price”
(19)
The
following sentence is deleted from the seventh paragraph (beginning with “The
following is a summary of the presentation….”) under “Special Factors — Section
4 — Summary of Presentation of Greenhill to Roche” in the Offer to
Purchase:
“The
following summary, however, does not purport to be a complete description of the
analyses performed or factors considered by Greenhill.”
(20)
The
following sentence replaces the sentence that begins with “The consolidated
financial statements of the Roche Group....” on page 56 under “The Offer —
Section 9 — Certain Information Concerning the Purchaser and Parent” in the
Offer to Purchase:
“The
consolidated financial statements of the Roche Group contained in the Roche 2008
Finance Report have been prepared in accordance with International Financial
Reporting Standards as issued by the International Accounting Standards
Board.”
(21)
The
phrase “, in our reasonable judgment, ” is added to the Offer to Purchase after
each of the following phrases: (a) “that any material contractual right of the
Company or any of its subsidiaries” in paragraph (vii) under “The Offer —
Section 12 — Conditions of the Offer;” (b) “that any material amount of
indebtedness of the Company or any of its subsidiaries” in paragraph (vii) under
“The Offer — Section 12 — Conditions of the Offer;” and (c) “paid or agreed to
pay any cash or other consideration to any party in connection with or in any
way related to” in paragraph (x) under “The Offer — Section 12 — Conditions of
the Offer.”
(22)
The
phrase “, in its reasonable judgment” is added to the Offer to Purchase before
“; or” at the end of paragraph (viii) under “The Offer — Section 12 — Conditions
of the Offer.”
(23)
The
phrase “(including any action or omission by any member of the Roche Group)” is
deleted from the Offer to Purchase from (a) the penultimate paragraph under “The
Offer — Section 12 — Conditions of the Offer” and (b) the last paragraph
(beginning with “The foregoing conditions are for the sole benefit….”) under
“The Offer — Section 12 — Conditions of the Offer.”
(24)
The
following paragraph replaces the first paragraph under “The Offer — Section 15 —
Miscellaneous” in the Offer to Purchase:
“The Offer is being made to all holders
of Shares. We are not aware of any jurisdiction where the making of the Offer is
prohibited by any administrative or judicial action pursuant to any valid
statute. If we become aware of any valid statute prohibiting the making of the
Offer, we will make a good faith effort to comply with that statute. If, after a
good faith effort, we cannot comply with the statute, we will not make the Offer
to holders of Shares in the relevant jurisdiction. In any jurisdiction where the
securities, blue sky or other laws require the offer to be made by a licensed
broker or dealer, the Offer shall be deemed to be made on behalf of the
Purchaser by the Dealer Manager or by one or more registered brokers or dealers
licensed under the laws of such jurisdiction.”
(25)
All
references in the Offer to Purchase to “Company’s stockholders unaffiliated with
the Roche Group” and to “stockholders of the Company who are unaffiliated with
the Roche Group” are replaced with references to “Company’s stockholders
unaffiliated with the Company” and to “stockholders of the Company who are
unaffiliated with the Company”, respectively.
After due
inquiry and to the best knowledge and belief of the undersigned, each of the
undersigned certify that the information set forth in this statement is true,
complete and correct.
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Date:
March 6, 2009
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ROCHE
INVESTMENTS USA INC.
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By: /s/ Carol
Fiederlein
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Name: Carol
Fiederlein
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Title: Secretary
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ROCHE
HOLDING LTD
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By: /s/ Steve
Krognes
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Name: Steve
Krognes
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Title: Authorized
Signatory
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By: /s/ Beat
Kraehenmann
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Name: Dr.
Beat Kraehenmann
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Title: Authorized
Signatory
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11