UPDATE 1-Axcan to be bought by equity firm for $1.3 bln

(Adds details. In U.S. dollars)

TORONTO, Nov 29 (Reuters) - A U.S.-based private equity firm plans to pay $1.3 billion for Axcan Pharma Inc AXP.TO AXCA.O in a deal that will eventually see the pharmaceutical company taken private.

TPG Capital and its affiliates said it will pay $23.35 a share for all of the common shares of the Canadian firm which focuses on the treatment of gastrointestinal disorders.

The offer is a 28 percent premium over the stock's closing price of $18.20 on Nasdaq on Wednesday. It closed at C$17.96 on the Toronto Stock Exchange.

Axcan's board accepted the offer and recommended that shareholders also accept the deal.

Axcan said the transaction is expected to close in the first quarter of 2008. Once it is completed the company will be delisted. It will retain its headquarters in Quebec.

TPG is expected to fund the acquisition through its existing cash as well as debt financing committed by Bank of America and HSBC. ($1=$0.99 Canadian) (Reporting by Scott Anderson; Editing by Frank McGurty)