CORRECTED-UPDATE 1-Auxilium Pharma to buy eye drug maker QLT
(Corrects to remove deal value from headline and paragraph 1)
June 26 (Reuters) - Auxilium Pharmaceuticals Inc would buy Canadian drugmaker QLT Inc to add QLT's experimental treatment for eye diseases caused by gene mutations.
In a reverse takeover, Auxilium shareholders will end up owning about 76 percent of the combined company after they receive 3.1359 QLT shares for each share held.
Auxilium shares were up 18 percent at $25 in premarket trade, while QLT's U.S.-listed shares rose 30 percent to $7.
For QLT shareholders, the deal represents a 25 percent premium based on a calculation of the closing prices of Auxilium and QLT shares on the Nasdaq on June 25, the companies said.
QLT's treatment, synthetic retinoid, replaces a key chemical component in the eye that plays a role in visual functioning. The drug is being tested to treat eye diseases caused by gene mutations that hamper the availability of the component.
Auxilium, whose products focus on men's health, orthopedics and dermatology, said it plans to continue to look for potential partnership agreement for late-stage studies of the drug.
About 32 percent of QLT shareholders have agreed to vote in favor of the deal that is expected to close in the fourth quarter of 2014.
Deutsche Bank, Skadden Arps and Morgan Lewis, and Houlihan Lokey Financial Advisors Inc advised Auxilium, while Credit Suisse, McCullough O'Connor Irwin LLP, Nutter McClennen & Fish LLP and KPMG LLP acted as advisers to QLT. (Reporting by Esha Dey in Bangalore; Editing by Sriraj Kalluvila)
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