SQNM Sequenom: Caris reviews hostile offer for EXAS; firm sees neo-natal IP as likely the real driver; SQNM may have to chase bid - Caris (23.02 )
Caris notes after the close last Friday, SQNM announced a hostile bid to acquire Exact Sciences (EXAS) for $41M in stock. While SQNM's press release indicates that cancer diagnostics is the basis for the potential acquisition, they believe EXAS's neo-natal patent estate could be the main driver. The EXAS bid supports their view that SQNM's IP position is not as secure as it claims, and the Co may need to pay up for EXAS. They believe that multiple companies could be interested in the EXAS IP, and additional bids could push the price higher. While they don't cover EXAS, they believe that shares offer an attractive hedge to any near term downside in SQNM.