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12:00 AM
 | 
Jul 16, 2012
 |  BioCentury  |  Finance

Asset value arbitrage

BB Biotech fund rejects push by Vontobel Group to go private

The Vontobel Group is looking to take Swiss biotech fund BB Biotech AG private. That would allow both the Swiss bank and shareholders of BB Biotech to cash in on a longstanding discrepancy between the net asset value of the fund and its market cap.

Vontobel said its offer is a 31.7% premium to BB Biotech's CHF81.95 share price last Thursday, the day before the offer was disclosed. That would put the offer price at CHF107.90 per share, or CHF1.4 billion ($1.4 billion) based on 13 million shares outstanding.

BB Biotech (SIX:BION; Xetra:BBZA) closed Thursday at a 27.3% discount to the CHF113.50 per share NAV of its public biotech portfolio. Before the offer was announced, the NAV was up about 50% for 2012, while the shares had gained only 30%.

Vontobel noted the discrepancy has persisted even though BB...

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