If Roche doesn’t use the money for an acquisition, it can wait until Jul 2010 and then buy back its own shares without incurring an interest rate step-up on the bonds. At the current share price, repurchasing its own shares would be highly accretive to EPS.
Addendum re Roche's potential share buyback: In a sense, the pharma business is becoming more like the banking business. The future profit margins in pharma will almost certainly be lower than they have been during the past few decades, and hence leveraging the balance sheet will be necessary to maintain a robust return on equity.
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