Jazz Pharmaceuticals PLC (NASDAQ: JAZZ) announced Tuesday morning that it has reached a definitive agreement to acquire Celator Pharmaceuticals Inc. (NASDAQ: CPXX) for $30.25 per share in cash. The deal reflects a premium of 72% to Celator’s closing price on Friday and totals about $1.5 billion.
Celator is preparing an application to the U.S. Food and Drug Administration for its Vyxeos treatment for a form of leukemia known as acute myeloid leukemia (AML), a new orphan drug.
Jazz expects to finance the transaction with a combination of cash on hand and borrowings under its senior secured credit facility. The deal is expected to close in the third quarter of this year.
The deal is structured as a tender offer and second-step merger, and Jazz said that certain stockholders controlling about 18.4% of Celator’s stock have agreed to tender their shares in the offer.
Bruce Cozadd, chairman and CEO of Jazz, said:
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. 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.
Celator CEO Scott Jackson added:
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.
Celator’s shares traded up more than 71% in Tuesday’s premarket to $30.03, after closing at $17.53 on Friday. The stock’s 52-week range is $1.12 to $18.18.
Jazz stock traded down about 1.4%, at $150.00 in a 52-week range of $108.50 to $194.73.