Roche / Genentech: Lending Not So Frozen After All

Don’t look now but the largest corporate bond offering ever was just announced. Swiss pharmaceutical giant Roche (RHHBY.PK) is attempting to raise about $16 billion in several tranches to acquire the balance of outstanding Genetech (DNA) shares (44%) in a hostile bid announced earlier this month.

Every day we hear how lending has dried up, frozen, stopped along with an infinite variety of similar words. Thus an annoucement of this magnitude should be shouted from the mountain tops, not lost in a one liner that is then quickly run over by more announcements of lack of lending.

I accept that the borrower is in a "recession-proof" industry. Nonetheless, $16 billion raised by one corporation is a significant event that should be looked upon as a truly positive and encouraging event.

By the way, early indications are that there is strong demand.

Disclosure: Author owns shares of DNA

Comments

[Jgutmanmd:]

Great news, imagine, Roche will eventually buy Ipsen, and the critical mass of genentech being able to design a better Dysport will have a serious impact in many areas. Allergan should be scared, although they have been so arrogant that they may miss the forest for the tree...

Feb 20 01:38 PM