Swiss drug maker Roche Holding said it was prepared to walk away from its attempt to take over Illumina Inc. after the San Diego biotech company's shareholders rejected Roche's attempts to appoint new board members.
Roche's current offer of $51 per Illumina share will expire Friday. Severin Schwan, the company's chief executive, said in a statement that a higher price is not "in the interest of Roche's shareholders."
The hostile bid for Illumina would amount to a $6.8-billion takeover at that share price.
Schwan said Illumina, which makes products used for genetic analysis, had failed to "engage in a constructive dialogue" even after Roche boosted its original January offer of $44.50 a share to $51 on March 29. Illumina Chief Executive Jay T. Flatley called the offer "inadequate."
Illumina shares Wednesday rose 51 cents to $44.51.
The $51-a-share offer represented an 88% premium over Illumina's closing price Dec. 21, before rumors of a potential acquisition caused the stock to surge, according to Roche.
On Wednesday, Illumina said its shareholders snubbed several proposals from Roche, including one to increase the size of the board and another nominating two candidates as board members. Instead, shareholders backed four contenders for the board recommended by Illumina.
"We are pleased that … we can now return our full focus to growing our business, making the most of the expanding opportunities in our space and delivering superior results for our customers and stockholders," Flatley said in a statement.
Schwan said Roche "will continue to consider options and opportunities to develop further its portfolio of businesses in order to expand its diagnostics leadership position."
Roche's healthcare products include oncology, virology and metabolism medications, cancer diagnostics and diabetes management. The company, which also owns South San Francisco-based Genentech, employed more than 80,000 people as of last year.