Origin Technologies Raises Bid for Affymetrix -- 2nd Update
23 March 2016 - 11:25AM
Dow Jones News
By Josh Beckerman
A group of former Affymetrix Inc. executives on Tuesday raised
its offer for the genetic-analysis company by 5.6% in another
attempt to disrupt the planned tie-up with Thermo Fisher Scientific
Inc.
Origin Technologies Corp., a newly formed entity owned by former
Affymetrix executives, 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.
Earlier this week, Affymetrix reaffirmed its commitment to the
Thermo-Fisher deal. 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 deal offered a 52%
premium to Affymetrix's stock price before the announcement.
Origin on Tuesday also called for Affymetrix to delay the
shareholder meeting scheduled for Thursday to vote on the sale to
Thermo Fisher.
Affymetrix and Thermo Fisher representatives didn't immediately
return calls for comment. Thermo Fisher said earlier Tuesday that
its deal has "more value" and "far less risk" than Origin's
offer.
In rejecting Origin's earlier offer, Affymetrix said Origin
appeared to be a newly-formed shell entity with no known assets.
Affymetrix said Origin's "sole source of funding" was $1.5 billion
in potential debt commitments and that this "falls materially short
of the funds" needed to complete a deal.
When Origin announced the offer it said it had fully committed
debt financing from Shanghai-based private-equity firm SummitView
Capital.
Affymetrix said it had preliminary talks last fall with
individuals who became principals and potential backers of
Origin.
In recent after-hours trading, Affymetrix shares rose 2.7% to
$14.76.
The four people running Origin formerly worked at Affymetrix as
vice presidents, including a former general counsel and a head of
molecular diagnostics research and development.
Origin has said it would consider a combination with genomic
technologies company Centrillion Technology Holdings Corp.
following an Affymetrix deal. Origin's president, Wei Zhou, founded
Centrillion.
Origin said it is prepared to increase a proposed reverse
termination fee to $100 million from $75 million, to provide
assurance of its commitment to the deal and demonstrate confidence
in its ability to meet its financial obligations.
It is also prepared to include a "hell or high water" provision
in a merger agreement requiring it to "take any and all actions
required to obtain regulatory approvals, in the event they are
required."
Write to Josh Beckerman at josh.beckerman@wsj.com
(END) Dow Jones Newswires
March 22, 2016 20:10 ET (00:10 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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