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Shire Buying New River Pharmaceuticals

AP
Tuesday, 20 Feb 2007 | 7:23 AM ET

British pharmaceutical company Shire, which makes ADHD drug Adderall XR, said Tuesday it is buying U.S. drug maker New River Pharmaceuticals for approximately $2.6 billion, or $64 per share in cash.

The purchase price represents a 14.4% premium to New River's four-week average closing price of $55.92 per share and is a 10% premium to its Friday closing price of $58.35 on the Nasdaq Stock Market.

The acquisition will include a cash tender offer by a Shire subsidiary for all of New River's outstanding shares, expected to start on March 2 and close early in the second quarter.

New River founder, Chairman and Chief Executive Randal J. Kirk has agreed to tender the 50.2% of New River outstanding shares he owns.

"We are delighted to be entering into this transaction with Shire, which will assume full responsibility for the commercialization of Vyvanse, as well as the development of our other pipeline compounds," said Kirk. Vyvanse is the companies' new treatment for ADHD, or attention deficit hyperactivity disorder.

Shire said it plans to raise about $800 million through a private placement of shares to certain institutional investors to help pay for the acquisition.

Both companies' boards have approved the deal.

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