Otsuka confirms takeover bid for Astex Pharmaceuticals for $886 million

Following heavy speculation on Wednesday (see The Pharma Letter story earlier today), this morning Japanese drugmaker Otsuka (TYO: 4768) confirmed that it plans to acquire USA-based Astex Pharmaceuticals (Nasdaq: ASTX) for $8.50 per share in cash, representing a 48% premium to the average closing stock price for the prior 30 day period.

The transaction has been unanimously approved by the board of directors of both companies. The purchase price represents a fully diluted equity value of around $886 million, calculated using the treasury stock method. Otsuka intends to effect the transaction through a tender offer and expects to close the transaction early in the fourth quarter of 2013, subject to the satisfaction of customary closing conditions.

The acquisition of Astex adds to Otsuka's existing discovery capabilities and pipeline of therapeutic products for neuroscience, cardiovascular, and oncology indications, and it provides Otsuka with PYRAMID, the proven, world-class drug discovery platform developed by Astex. Otsuka's approved products in the US include: Abilify (aripiprazole), Samsca (tolvaptan) and IV Busulfex (bulsufan).