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Serono to Buy Genset For $106.5 Million, Cut Workforce

This article has been updated from an earlier version to include specifics about personnel changes.

 

 

NEW YORK, June 26-Serono will acquire the French genomics company Genset for €107.4 million ($106.5 million), the companies announced early this morning.

 

Genset's Evry, France research center will become Serono's worldwide genetics headquarters, and Genset's Paris-based support staff will be transferred to the Evry site.

 

About 20 percent of Genset's workforce of 250 will be laid off, and the company's San Diego operations will probably be shuttered. San Diego houses the company's preclinical metabolic disorder research group and all its U.S. administrative support, 46 employees in all.

 

A company representative said that the layoffs will be concentrated in administration and support rather than in R&D. As of May 31, Genset employed 214 R&D personnel and 36 administrative staff.

 

Genset's two most senior personnel--board chair and Directeur Generale Marc Vasseur and chief scientific officer Daniel Cohen--will remain with the company in their current roles.

 

According to the two companies, the purchase will pair Genset's gene and protein discovery work with Serono's functional genomics research to created an integrated drug discovery pipeline. Other valuable Genset assets include a secreted protein cDNA library, a therapeutic in early development, and scientific expertise linking genes and diseases.

 

The offer was accepted by Genset's board on June 25, and must be approved at a shareholders' meeting scheduled for today.

 

For each Genset American Depositary Share, Serono will offer €3.25 ($3.22), a 116 percent premium over the NASDAQ price on June 18, the day before Genset suspended trading.

 

For each share traded on the Parisian Nouveau Marche, Serono is offering €9.75 ($9.67). Serono also is offering €102.64 ($101.84) for each Genset convertible bond. Both are priced at steep premiums over recent market prices.

 

Serono, based in Geneva, is the largest biotechnology company in Europe, with 2001 revenues of $1.38 billion.

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