UPDATE 1-Cytori, Astellas Pharma sign $10 mln equity deal

Tue Dec 7, 2010 7:40am EST

* Cytori to sell equity at $7.00/shr

* Astellas to buy 1.43 mln unregistered shares of Cytori

* Cytori gives Astellas non-voting observer seat on board

Dec 7 (Reuters) - Cytori Therapeutics Inc (CYTX.O) said it signed a $10-million equity deal with Japan's No.2 drugmaker Astellas Pharma (4503.T) to evaluate the potential of adipose derived stem and regenerative cells.

As per the agreement, Astellas will buy about 1.43 million unregistered shares of Cytori common stock at $7.00 each, or 35 percent more than the stock's Monday close.

Additionally, Astellas will have non-voting observer seat on Cytori's board and participate in a newly formed scientific advisory board.

The two companies will further explore a collaboration for an advanced regenerative drug technology, Cytori said in a statement.

The transaction is expected to close around Dec. 13.

San Diego, California-based Cytori's shares, which have gained about 10 percent since the company got European approval for its PureGraft device in July, closed at $5.20 on Monday on Nasdaq. (Reporting by Krishnakali Sengupta in Bangalore; Editing by Maju Samuel)

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