Minster Pharma stock rockets after accepting 4.3 million takeover bid from Proximagen

UK-based Proximagen Neuroscience has reached agreement with Britain's Minster Pharmaceuticals to acquire the latter for 6 pence a share, or a total of about £4.3 million ($6.9 million), a premium of some 45.5% on its closing price December 31, 2009, the last trading day prior to the announcement.

The news saw Minster's stock leaping 40.6% to 5.8 pence on January 4. The deal is conditional on Minster having a minimum net cash balance of £3.5 million, but has been backed by the company's directors who hold shares and is being recommended to other shareholders.

For Proximagen, a spin-out from King's College London in 2003 which raised £50 million in a placing at 140 pence last June, this is the second acquisition deal. In August, it bought another development concern in the same field, Cambridge Biotechnology, from its Swedish parent Biovitrum, in a move that was aimed at gaining access to late-stage developmental compounds. This included certain of CBT's programs, as well as two clinical-stage projects (5-HT2c agonist program and the cognition program, 5-HT6) and a number of preclinical stage programs including VAP-1 and TrkA from Biovitrum.