Cephalon, a biopharmaceutical company, has announced that its wholly-owned subsidiary, Cephalon International Holdings, intends to make a takeover offer for Australia-based biotechnology company Arana Therapeutics.
Under its bid, Cephalon intends to offer A$1.40 cash for each Arana ordinary share cum dividends and other rights. The total offer value is approximately A$318 million. The offer price represents a 70% premium to Arana’s 90-day volume weighted average price and a 69% premium to the closing price on February 25, 2009, the last trading day prior to this announcement.
The offer has the support of the Arana independent directors and will be recommended to Arana shareholders in the absence of a superior proposal.
If Cephalon obtains a relevant interest in 90% of Arana shares and the offer conditions are satisfied or waived, Cephalon will increase its offer price by five Australian cents per share. This offer price increase will be payable to all shareholders no matter when their acceptances are received. In these circumstances accepting Arana shareholders will receive A$1.45 per share. Cephalon intends to fund the offer price using a portion of its existing cash balance.
To support its bid, Cephalon has acquired a shareholding in Arana, representing an ownership position of approximately 19.9% of the total issued share capital of Arana. The purchase price of the shares was A$1.40 per share. Cephalon has acquired this stake from Arana’s two largest shareholders, Start-up Australia Ventures and Rockwell Securities.
Cephalon’s offer will be subject to certain basic conditions, including a 50.1% minimum acceptance condition. Cephalon expects the offer will be open for acceptance by mid-March 2009.