Targacept and Catalyst Biosciences agree to merge

Targacept (Nasdaq: TRGT) and fellow USA-based Catalyst Biosciences, a privately held biopharmaceutical firm, have entered into a definitive agreement to merge the two companies.

The combined entity, to be named Catalyst Biosciences, is expected to create a financially strong company to harness the catalytic power of engineered human proteases to develop next-generation biopharmaceuticals with improved efficacy and therapeutic index to treat major diseases.

Initially, Catalyst shareholders will own around 65% of the combined company and Targacept shareholders about 35%. The latter will receive a dividend of an aggregate of $37 million in non-interest bearing redeemable convertible notes and around $20 million in cash.