Illumina management told its shareholders that accepting the revised offer was not in their best interests and urged them not to tender any shares.

The Swiss drugmaker last week raised its offer to buy Illumina from an initial overture of $44.50 per share in an effort to curry support from shareholders of the U.S. company ahead of Illumina's annual meeting later this month.

Illumina shares were trading above $51 on Monday, indicating that investors expect the Roche bid to be raised again. A source familiar with the situation last week told Reuters that Roche could further increase its bid if it found more value in the business during the due diligence process.

In a letter to Roche Chairman Franz Humer rejecting the latest offer, Illumina Chief Executive Jay Flatley said that "it dramatically undervalues Illumina and does not adequately reflect Illumina's singular position in an industry poised for extraordinary growth."

It goes on to call Roche's offer "opportunistic" and said Roche was "fully aware that even the revised offer does not reflect the intrinsic strength or future prospects of Illumina."

Roche declined to comment on the latest Illumina rejection.

San Diego-based Illumina urged its shareholders to support its slate of directors at the April 18 annual meeting and reject Roche's proposals.

Earlier on Monday, Illumina projected first-quarter revenue well above consensus estimates, and said it expects profit to exceed or meet market expectations.

For the quarter ended April 1, Illumina said it expects to report revenue of about $270 million, above the $257.4 million expected by analysts, on average, according to Thomson Reuters I/B/E/S.

Profit is estimated to be in line or exceed the 31 cents per share expected by analysts, Illumina said.

Illumina also said the first quarter marks the third consecutive quarter in which it had a book-to-bill ratio of over 1. A book-to-bill ratio above 1 means that Illumina booked more orders than it could deliver in the quarter, reflecting increased demand for its products.

Illumina makes equipment that decodes a person's entire genome. It would give Roche a leading position in the promising market for gene sequencing and fit nicely with its large diagnostics business.

Illumina shares were down 60 cents at $52 in afternoon trade on Nasdaq after trading as high as $52.62 earlier in the day.

(Reporting By Bill Berkrot; additional reporting by Zeba Siddiqui in Bangalore; Editing by Gerald E. McCormick and Phil Berlowitz)

• A Permanent Economic Emergency