M&A

Roche delays $4.3B Spark buyout — again — as FTC review drags on

The Roche/Spark deal is still happening. On time. It’s just going to take a little longer.

So says the Swiss giant, which has extended its tender offer for a second time. Withdrawing and refiling the Premerger Notification and Report Form gives the FTC more time to complete its regulatory review — a routine practice that was also cited as reason for delay three weeks ago.

“This was done in agreement with Spark and the relevant FTC stakeholders and is not unusual in a transaction of this type,” a spokesperson said in an email.

Roche still expects to wrap the deal and begin integrating the biotech’s gene therapy operations in the first half of 2019, which would allow no further delay from the new deadline on June 3.

Notably, before Roche announced the extension of its offer, it only counted 26.1% of Spark’s outstanding shares on its side. That’s slightly lower than the 29.4% tendered on the previous April 2 deadline, which is still a far cry from the 50% required to complete the deal.

The spokesperson reiterated what they told me last time, that the offer is “full and fair,” and has been unanimously recommended by the board of Spark. They add:

In a transaction of this type, a significant portion of shareholders customarily tender their shares during the last days of the tender offer period. Therefore, we do not view the level of tendered shares at this time as in any way indicative of shareholder support for the transaction.

Reuters previously noted that Philadelphia-based Spark faces at least three lawsuits in the US accusing leadership of undervaluing its stock and being unfair to investors. Roche declined to comment on “legal matters.”


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