Sagent Pharmaceuticals Inc (NASDAQ:SGNT) shares were up nearly 40% at the start of the week on reports that the company will be acquired by Japan's Nichi-Iko.
Sagent Pharmaceuticals Inc (NASDAQ:SGNT) shares were up 39.68% to $21.65 and down 0.30% in after-hours trading. The company has a market cap of $344.65 million at 32.84 million shares outstanding. Share prices have been moving in a 52-week range of $10.55 to $26.47.
Sagent Pharmaceuticals is a specialty and generic pharmaceutical company which provides pharmaceuticals to the hospital market, which it sells primarily throughout North America. The company also focuses on developing, manufacturing, sourcing and marketing injectable pharmaceutical products to the hospital market.
The company has agreed to be acquired by Japan’s Nichi-Iko, which is also a pharmaceutical company. The deal is valued at $714.3 million and the Japanese company will pay $21.75 for each outstanding share of Sagent Pharmaceuticals in an all-cash transaction.
The combination will maintain Sagent’s current operations and valued employees while providing accelerated expansion of our product offerings and accessibility to a robust pipeline of biosimilar pharmaceuticals,” said Sagent Chief Executive Allan Oberman.
Meanwhile, the deal would enhance the Japanese company’s portfolio in the US market where it plans to commercialize its existing product pipeline. On the other hand, it would also provide Sagent Pharmaceuticals access to Nichi-Iko’s manufacturing infrastructure and quality control systems while maintaining its current operations. In addition, Sagent’s current management team is expected to lead the merged entity.
The combination will give us the opportunity to strengthen our international competitiveness, leverage our production capacity over a wider range of products, and accelerate development of our biosimilars business,” said Yuichi Tamura, Nichi-Iko’s chief executive.
This transaction is expected to close by the second quarter of this year, pending regulatory and shareholder approval. The tender offer will commence 15 days after the signing of the merger agreement and will be followed by a second-step merger. However, upon the termination of the deal, Sagent Pharmaceuticals will be required to pay $24.3 million to Nichi-Iko under specified circumstances.
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