Novartis AG CEO Tempers Talk of Selling Roche Stake

Novartis Chief Executive Joe Jimenez played down talk that it was looking to sell its one-third voting stake in crosstown rival Roche, and certainly not at its current market price. There has been widespread speculation that the Novartis could be heading for a change of strategic direction - including a possible sale of the Roche stake - following the appointment of a new chairman on Wednesday. "It's a strategic purchase," Jimenez said of the holding during an interview at the World Economic Forum in Davos. "What we mean by that is the value of that stake is worth more than the market price today. Today, you couldn't recreate a 30 percent stake in a company like Roche by purchasing on the open market. "From a shareholder standpoint, we wouldn't want to sub-optimize the asset, just like we wouldn't want to sub-optimize any other asset." Previous Novartis boss Daniel Vasella secured the 33 percent voting stake in Roche between 2001 and 2003. Vasella initially said he wanted to merge the two Swiss drugmakers but, after hitting resistance, kept the block as a long-term investment.