By Lisa Kerner
Charlotte, N.C., Feb. 20 - Shire plc said it agreed to acquire New River Pharmaceuticals, Inc. for $64 per share, or approximately $2.6 billion for the fully diluted equity interest.
The all-cash transaction was unanimously recommended by the boards of both companies and is expected to close in April, according to a company news release.
Shire said the acquisition is structured as a tender offer for all outstanding shares of New River beginning March 2 followed by a merger.
New River founder and chief executive officer R.J. Kirk, who beneficially owns 50.2% of the total outstanding shares of the Radford, Va., specialty pharmaceutical company, agreed to support the merger and tender his shares in the offer.
Shire, a specialty pharmaceutical company located in Basingstoke, England, plans to fund the transaction through $2.3 billion in new debt financing and an accelerated private placement worth about $800 million.
In January 2005, the companies entered into a collaborative agreement to develop and co-promote NRP104, now known as Vyvanse (lisdexamfetamine dimesylate), for attention deficit and hyperactivity disorder. The acquisition will give Shire control of the future development and commercialization of Vyvanse in the $3.3 billion U.S. ADHD market.
"This is an important and complementary acquisition that gives us full control of Vyvanse, a novel drug," Shire chief executive officer Matthew Emmens said in a company news release.
"We are confident and expect that the final labeling will provide patients, parents and physicians with real benefits that differentiate this compound from other ADHD products.
"The combined debt and equity financing announced [Tuesday] enables us to both acquire New River and retain the financial flexibility to make further acquisitions that will continue to drive Shire's growth."
| Acquirer: | Shire plc
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| Target: | New River Pharmaceuticals, Inc.
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| Transaction value: | $2.6 billion
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| Payment per share: | $64 per share
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| Announcement date: | Feb. 20
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| Expected closing: | April
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| Stock price for acquirer: | Nasdaq: SHPGY; $63.28 on Feb. 16
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| Stock price for target: | Nasdaq: NRPH; $58.35 on Feb. 16
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