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Roche-Genentech: As The Deal Turns

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What's $23 between friends, er, sparring business partners? The question brings back memories of my grandfather who was of the generation that would hold a grudge for years against a distant relative who still owed him a small amount of money.

Anyway, in the ongoing soap opera between Swiss drugmaker Roche and California biotech giant Genentech , late yesterday Roche filed its formal tender offer for DNA with the Securities and Exchange Commission. There are 145 items in all! If you have way too much time on your hands you can check them out for yourself.

To save some time, Deutsche Bank biotech analyst Mark Schoenebaum says the most important documents are #2, the 143-page "Offer To Purchase" and #50, "Presentation." Roche is a majority stakeholder in Genentech, but wants to buy the whole kit and kaboodle.

In brief, there are several disagreements between the two companies over the outcome of various clinical trials, drug markets and pricing. As a result, Roche originally thought DNA was worth $89 a share. (It recently lowered the bid to $86.50.) Genentech says $112 is more like it.

Genentech has 10 days to file its response. In a press release Genentech says that SEC filing "will explain in detail" the reasons behind the position it's taking on the hostile tender offer. I'm still hoping against hope the company will couple that stance with some interviews to try to match the rhetoric and deliberate, somewhat aggressive news media campaign Roche has waged. The company took CEO Severin Schwan on an extensive American business media tour last Friday, including CNBC, to very publicly make his case for the takeover.

You can check out my exclusive U.S. TV interview here.

In the SEC filing Roche says it "plans to obtain the necessary funds (for the deal) through a combination of bank borrowings, issuances of debt securities and other sources of financing, as well as from available cash held by the Roche Group. We will only be able to consummate the Offer if we have obtained sufficient financing." With DNA shares continuing to trade well below the $86.50 offer that's on the table, investors still think Roche might not be able to come up with the cash.

Questions? Comments? Pharma@cnbc.com