Impax Labs goes on a $700 million buying spree

US generic drugmaker Impax Laboratories (Nasdaq: IPXL) saw its shares leap 11.2% to $26.52 in pre-market trading today, as the company revealed plans for two acquisitions.

Impax announced the execution of a definitive agreement under which it will acquire Tower Holdings, including operating subsidiaries CorePharma and Amedra Pharmaceuticals, and Lineage Therapeutics for $700 million in cash, subject to certain customary purchase price adjustments.

The privately-held companies being acquired specialize in the development, manufacture and commercialization of complex generic and branded pharmaceutical products. The transaction will provide Impax with a highly-profitable and growing commercialized portfolio of products that are expected to generate full year 2014 revenues of around $215 million to $225 million and earnings before interest, taxes, depreciation and amortization (EBITDA) of about $80 million to $85 million on a standalone basis. Assuming a close within the next six months, the transaction is expected to be approximately $0.90 accretive to Impax' 2015 earnings per diluted share.