Celator Pharmaceuticals Inc has agreed to be acquired by Jazz Pharmaceuticals plc – Ordinary Shares for $30.25 per share or about $1.5 billion in cash. Jazz believes that the acquisition will help the company to advance its growth strategy.
Shares of Celator Pharmaceuticals were trading up 71.11% in the morning session. The company’s stock has gained 1,594.07% year-to-date.
Transaction Structure
Celator said in a statement that the transaction is structured as a tender offer and second step merger. The tender offer is conditioned upon customary conditions, including the tender of a majority of the outstanding shares of the company’s common stock and expiration or termination of the Hart Scott Rodino waiting period.
“The planned combination of Jazz and Celator is highly complementary, as both companies are dedicated to bringing differentiated therapies to patients who have high unmet medical needs,” Celator CEO Scott Jackson stated. “We believe that Jazz Pharmaceuticals’ clinical and commercial expertise in hematology/oncology and existing international infrastructure will help realize the value of VYXEOS as a treatment to patients with AML. After thoroughly evaluating our strategic options, our board of directors has unanimously determined that this all-cash transaction is in the best interest of our stockholders.”
According to Celator, certain stockholders holding approximately 18.4% of the company’s outstanding common stock shares agreed to tender their shares in the offer. Those stockholders include executive officers, members of the company’s board and certain investment funds affiliated with the members of the board members.
Jazz Pharmaceuticals is expected to finance the transaction with a combination of cash on hand and borrowings under its senior secured credit facility.
Celator’s Drug For Blood Cancer
Celator Pharmaceuticals Inc is an oncology-focused biopharmaceutical company that is developing products to improve patient outcomes in cancer. Less than three months ago, the company reported positive results for a clinical trial of Vyxeos. The therapy aims to treat Acute Myeloid Leukemia (AML), a blood cancer, with two available drugs in a new formulation.
The U.S. Food and Drug Administration (FDA) granted Breakthrough Therapy designation to Vyxeos. The therapy was granted orphan drug status by the FDA and the European Commission.
“Celator Pharmaceuticals is a strong strategic fit with Jazz Pharmaceuticals. VYXEOS will further diversify our product portfolio and is complementary to our clinical and commercial expertise in hematology/oncology,” Jazz Pharmaceuticals plc – Ordinary Shares Chairman and CEO Bruce Cozadd stated. “As Celator is currently preparing a regulatory submission in the U.S. for VYXEOS, this acquisition would add a new orphan product with the potential for short- and long-term revenue generation and expansion of our international commercial platform.”
The deal is expected to close in the third quarter of 2016.
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