Friday, March 2, 2012

Quick hits….

  • 23andme & Muhammad Ali are partnering for Parkinson's research. I'm not an Ali fan (I think he is a product of some excellent p.r. over the years, covering up the fact that he was a tremendous a$$ when active as an athlete), but I'm very excited about any initiative that draws the general public's attention to genomics.
  • Apparently the Affymetrix-eBioscience deal might not be happening. It looks like AFFX's disappointing 4Q2011 financial results is making the merger financiers think twice about underwriting the transaction.  (Tell me if this makes sense: acquirer AFFX enterprise value: ~$215M. target eBioscience purchase price: $330M (all cash). Debt financing required for the deal: $190M.) I still think this deal is driven by AFFX's desire to dilute their reliance on the microarray business and to buy some sales growth, as there's still only a tenuous topical connection between Affymetrix & eBioscience respective businesses. Such a deal makes sense at a bargain price, but it looks like the lenders are realizing it's actually a premium price. (Notice the roster of lenders are more merchant lenders than traditional bankers.) Also: if you're eBioscience intending to cash out @ a very rich 4.5X sales, you've got 2 questions to consider: 1) would you be willing to give a little on the terms to get the deal done? (I would), or 2) would you be interested in buying AFFX?

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