Illumina, Inc. · NASDAQ:ILMN
Illumina — Merger or Acquisition (January 2012)
26 slides from Illumina's merger presentation, Jan 25, 2012
Slide 1: Strengthening Roche Diagnostics' offering in life sciences research and diagnostics
Strengthening Roche Diagnostics' offering in life sciences research and diagnostics Illumina Acquisition: Conference call with media, analysts and investors 25 Jan 2012
Slide 2: Forward-looking statements
This presentation contains certain forward -looking statements. These forward -looking statements may be identified by words such as 'believes', 'expects', 'anticipates', 'projects', 'intends', 'should', 'seeks', 'estimates', 'future' or similar expressions or by discussion of, among other things, s
Slide 3: Offer and proxy solicitation legend
THIS PRESENTATION IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE AN OFFER TO PURCHASE OR A SOLICITATION OF AN OFFER TO SELL ILLUMINA COMMON STOCK. THE SOLICITATION AND OFFER TO BUY ILLUMINA COMMON STOCK WILL ONLY BE MADE PURSUANT TO AN OFFER TO PURCHASE AND RELATED MATERIALS. INVESTORS A
Slide 4: Strategic Rationale: Transforming acquisitions have strengthened the Diagnostics business
Strategic Rationale Transforming acquisitions have strengthened the Diagnostics business *Immunohistochemistry / In situ hybridisation ** Electrochemiluminescence ***Polymerase Chain Reaction 1991 2003 2007 2012 Access to leading Sequencing technology Access to leading IHC/ISH* technology Access to
Slide 5: Agenda: Roche Diagnostics Overview
Roche Diagnostics Overview Illumina Overview Acquisition Rationale Transaction Financials 5
Slide 6: Roche Diagnostics: Leading business in IVD
Roche Diagnostics: Leading business in IVD Number 1 in in-vitro diagnostics* (IVD) Growing above the market** Broad array of technologies Chemistry and ELISA Arrays Sequencing IHC/ ISH PCR Cellular analysis Active in over 130 countries Commercial Reach Direct Roche Presence Distributors Source: Indu
Slide 7: Roche Diagnostics: Broad portfolio
Roche Diagnostics: Broad portfolio Spanning Life Sciences, Lab Diagnostics and Patient self-monitoring 8% of sales 64% of sales 28% of sales % Divisional sales 2010 Life Science App. Science Academia and Pharma In Vitro Diagnostics (IVD) Molecular Dx Molecular lab Blood screen. Tissue Dx Pathology l
Slide 8: Roche Diagnostics: Applied Science business
Roche Diagnostics: Applied Science business Provides access to basic science, potential new biomarkers and emerging technologies Life Science App. Science Academia and Pharma PCR Arrays Sequencing Cellular [] Access to leading scientific institutions and biotech companies [] Active participation in
Slide 9: Agenda: Illumina Overview
Roche Diagnostics Overview Illumina Overview Acquisition Rationale Transaction Financials 9
Slide 10: Illumina: Company overview
Illumina: Company overview Solid business with strong revenue and margins Company Facts []Founded in 1998 []Based in San Diego, California []~2,100 FTEs (year-end 2010) 2010 Financials []Revenue '10: USD 903 m []CAGR '06--'10: 49% []Operating Margin: 23% Source: Analyst reports, Thomson Financials,
Slide 11: Agenda: Acquisition Rationale
Roche Diagnostics Overview Illumina Overview Acquisition Rationale Transaction Financials 11 <
Slide 12: Acquisition Rationale
Acquisition Rationale Increase market participation Strengthen portfolio Unlock commercial potential Entry into IVD 12 <
Slide 13: Rationale: Increase market participation
Rationale: Increase market participation Strengthens presence in fast-growing market Sequencing Market Projected sales, m USD 200 201 2015 5 0 E Source: Analysts reports, Roche analysis Key Growth Drivers [] Increasing ease of use, throughput, speed and affordability [] Biomarker discovery opportuni
Slide 14: Rationale: Strengthen portfolio
Rationale: Strengthen portfolio Complements Roche's offering in sequencing 'Short Read' Applications Whole genome Re-sequencing RNA-seq Epigenomics ------------- 'Long Read' Applications Amplicon De-Novo Illumina Roche High throughput Low throughput Illumina Roche GS FLX MiSeq GS Junior Source: Roch
Slide 15: Rationale: Strengthen portfolio, broadens menu of technologies
Rationale: Strengthen portfolio Broadens menu of technologies for diagnostics customers Genomics (DNA/RNA) Sequencing Microarrays PCR SR LR HT LT Discovery Routine IVD In development BeadXpress cobas 4800 Benchmark cobas e modules cobas c modules Tissue IHC/ISH Proteomics Immunoassay Metabolics Chem
Slide 16: Rationale: Unlock commercial potential
Rationale: Unlock commercial potential Leveraging each company's strengths Illumina Sales 2010 USD 903 m U. S. Source: Company reports, Analysts reports 45% 55% Ex U.S. Roche Sales 2010 CHF 10,415 m Ex US 77% 23% U. S [] Focused on large academic facilities [] Solid relationships with genome centers
Slide 17: Rationale: Entry into IVD market
Rationale: Entry into IVD market Utilise Roche's comprehensive diagnostics expertise to accelerate transition of sequencing into routine clinical use Sequencing as Sequencing as research tool routine IVD test Development research IVD system and Technical and clinical Regulatory approval Scale, globa
Slide 18: Rationale: Entry into IVD market, companion diagnostics
Rationale: Entry into IVD market Leverage unique Roche Rx-Dx collaboration to develop IVD companion diagnostics tests Pharmaceuticals Research Development Commercialisation Unrestricted know-how More efficient Faster adoption of PHC solutions and IP exchange development (medicine and test) Technical
Slide 19: Rationale: Summary
Rationale: Summary Increase Strengthen our participation in fast-growing and increasingly market important sequencing market participation Strengthen Strengthens Roche's portfolio in sequencing and microarrays portfolio and complements offering in genomics research and diagnostics Unlock Capitalise
Slide 20: Agenda: Transaction Financials
Roche Diagnostics Overview Illumina Overview Acquisition Rationale Transaction Financials 20
Slide 21: Transaction Financials: Staying focused
Transaction Financials: Staying focused Aim to lead in selected business/disease areas (Oncolog) y(I)n A(f)l u a(t) m(o) m(im) am(ti)o(u) n n / e M d a(i) c(s) u e l a a s(r) /(e) R(seti)n B a i l(ologi)c D s(iagnostic) s (Sequencin) g -------- -------------------------------------------------------
Slide 22: Transaction Financials: Summary
Transaction Financials: Summary [] In line with our stated M and A policy [] Solid business with sustainable cash flow and attractive margins [] Financial flexibility of Roche Group not significantly affected 22
Slide 23: Transaction Financials: Overview
Transaction Financials: Overview [] $44.50 per share in cash for each outstanding share of Illumina (fully diluted) [] Transaction valued at approximately $5.7 billion on a fully diluted basis [] Intend to promptly commence tender offer following repeated attempts to engage Offer Illumina management
Slide 24: Transaction Financials: Next steps
Transaction Financials: Next steps [] Promptly commence tender offer to purchase all of the outstanding common stock of Illumina [] Offer will be subject to customary conditions [] Commence process to nominate slate of directors and make other proposals at Illumina's 2012 annual meeting which, if ad
Slide 25: Summary: Deploying capital for the right strategic purposes
Summary Deploying capital for the right strategic purposes [] Offer of $44.50 cash per share, representing an attractive value to Illumina's stockholders [] Sustainable cash flows and attractive margins [] Accretive to core EPS and operating profit in the first year post-closing [] Financial flexibi
Slide 26: We Innovate Healthcare
We Innovate Healthcare 26