Cangene to be acquired by Emergent BioSolutions; deal values Cangene at US$222M

WINNIPEG – Cangene Corp. (TSX: CNJ) has agreed to be acquired by Maryland-based Emergent BioSolutions (NYSE:EBS) in an all-cash deal that values the company at US$222 million.

The Winnipeg biopharmaceutical company says Emergent has agreed to pay US$3.24 per share for the company, a premium of 27 per cent to Cangene’s closing stock price of C$2.70 on Dec. 10. and a 45 per cent premium to its 90-day volume weighted average price.

The deal, subject approval by two-thirds of votes cast by shareholders along with court and other approvals, is expected to be completed in the first quarter of 2014.

“This compelling transaction is a reflection of our employees’ hard work and the quality and success of our business,” president and CEO John Sedor said Wednesday in announcing the deal.

“Over the last few years, our team has transformed Cangene into an exceptional specialty biopharmaceutical company and biodefence leader, as demonstrated by our recent product approvals and biodefence contracts.

“We believe Cangene will now benefit from becoming part of Emergent, a leader in developing vaccines, as well as therapeutics for addressing critical diseases and disorders,” he added.

Emergent president and CO Daniel Abdun-Nabi described the business as “highly complementary,” adding that the addition of revenue-generating products and services across biodefence, commercial specialty biopharmaceuticals and contract manufacturing “significantly advances Emergent towards achievement of our growth plan.”

The arrangement agreement is subject to non-solicit provisions and Cangene’s right to withdraw its recommendation of the transaction to shareholders in the event of a superior proposal. Termination fees would apply in certain circumstances.

Meanwhile, Cangene said shareholders collectively controlling approximately 61 per cent of Cangene shares have entered into support agreements to vote their shares in favour of the transaction.