Managing Editor, Medical Device Daily
Two days after a deadline expired in a hostile bid to acquire it, Biosite's board of directors said it will consider an acquisition by new suitor Inverness Medical Innovations, of Waltham, Mass., and begin negotiations, after determining it is likely to lead to a better proposal than its current offer from Coulter Beckman.
After consultation with its financial and legal advisors the Biosite board said the IMI offer - which at $90 a share is about a 5.9% premium over the BC offering price of $85 a share (about $1.55 billion) - was "likely to lead to a superior proposal." The board noted, however, that it "has not determined that the Inverness acquisition proposal constitutes a superior proposal."
Biosite's stock (NASDAQ:BSTE) closed at $93.69 Tuesday, up $1.43.
The Biosite board went on to say that it has not "approved, endorsed or recommended the Inverness acquisition proposal," and added that it has not "withdrawn, qualified, modified, changed or amended its recommendation with respect to the Beckman Coulter tender offer and the merger agreement between Biosite and Beckman Coulter remains in effect."
Expressing confidence that its deal is still superior, even at a reduced price, Scott Garrett, Beckman Coulter's president and CEO, said the company remains committed to its acquisition of Biosite and will waive the merger agreement provision that Biosite provide the company with 48 hours notice before negotiating with Inverness.
"The conditional and uncertain terms of the Inverness offer should give the Biosite board and its stockholders enormous pause," said Garrett. "In our view, the fact that Inverness has not proposed a tender offer, which could be concluded relatively quickly, speaks volumes about the firmness of its financing. Inverness' financing 'commitments' contain remarkably broad conditions and contingencies. It is not surprising, therefore, that Inverness instead is suggesting a one-step transaction - one that would take months to complete."
Garrett further suggested that the Biosite board should communicate the risks and uncertainties of the Inverness offer to Biosite's stockholders who, based on trading levels in the marketplace, may be unaware of the risks.
Biosite, a San Diego-based biomedical company commercializing proteomics discoveries for the advancement of medical diagnosis, said last week that Inverness is offering "substantially similar business terms" to Beckman's offer.
Fullerton, Calif.-based BC's tender offer for Biosite shares expires April 27, unless extended.