Allos shares gain as rumors of fall-out with Spectrum subside
(Reuters) - Shares of Allos Therapeutics Inc ALTH.O recouped much of their Monday losses after investors seemed to be reassured that the cancer drugmaker's sale to Spectrum Pharmaceuticals Inc (SPPI.O) remained on track.
A spokeswoman for Spectrum said the deal was progressing well and that the company was "very happy with everything."
"We're still very excited about the merger, but it is completely in the hands of the Federal Trade Commission," the spokeswoman said, adding that Spectrum could not disclose if it expected any trouble gaining FTC approval.
Representatives of Allos did not respond to phone and email messages left by Reuters seeking comment.
Although analysts said they did not know the source of rumors that the deal had fallen through, they agreed that the talk had resulted in a 20 percent fall in Allos's shares on Monday.
"Allos' chief executive told me he is actively working on the deal and they would certainly be the first to hear if there were any fundamental issues with Spectrum or the deal," Brean Murray, Carret & Co analyst Brian Skorney told Reuters.
CEO Paul Berns said he had no knowledge of changes to the deal with Spectrum, Skorney said.
Allos shares were up 18 percent at $1.69 by mid-morning on Tuesday on the Nasdaq after tweets referring to Skorney's conversation with Berns circulated in the market.
Henderson, Nevada-based Spectrum agreed in April to buy Allos for about $1.82 per share, after AMAG Pharmaceuticals Inc (AMAG.O) dropped its pursuit of the company last year.
Allos's stock had been trading around $1.79 until last Friday.
"Someone clearly sold a big position or shorted a big position (thinking that the deal was falling through) at the end of the day (Monday)," Skorney said.
"There's certainly the potential that Spectrum knows something that Allos doesn't know and Spectrum just hasn't informed them ... but I think that's pretty unlikely."
Spectrum's shares were down 0.36 percent at $16.74.
The companies said on July 6 they had extended the period for Allos shareholders to tender their shares to the offer to July 23. About 59.4 percent of the outstanding shares of Allos common stock had been tendered by then.
(Reporting by Zeba Siddiqui in Bangalore; Editing by Ted Kerr)