* Hospira further extends tender offer to June 16
* Hospira fails to pay for tendered Javelin shares: Javelin
* Javelin says Hospira breached loan agreement
* Javelin shares down as much as 20 pct
(Adds details on Hospira extending offer date, updates share
June 3 Javelin Pharmaceuticals Inc JAV.A said
it filed a lawsuit against its would-be acquirer Hospira Inc
HSP.N and its unit, claiming they have breached the merger
agreement, sending Javelin shares down as much as 20 percent.
In April, Hospira agreed to acquire Javelin for $145
million in cash, but on May 19, it extended the tender offer to
Separately, Hospira said Thursday, its unit Discus
Acquisition Corp, which was formed to acquire Javelin, has
further extended its tender offer to June 16, citing issues
related to the recall of certain batches of Javelin's
post-operative pain drug, Dyloject. [ID:nSGE64N1SQ]
In its statement, Hospira said after expiration of the
offer, it intends to acquire all remaining outstanding shares
of Javelin common stock by means of a merger under Delaware
law, if all conditions of the tender offer have been met.
As of the expiration of the current offer period on June 2,
about 78.47 percent of the outstanding shares of Javelin common
stock, had been validly tendered and not withdrawn, Hospira
While Javelin said all the conditions of the tender offer
were satisfied immediately prior to the expiration of the
initial offering period, Hospira said that based on its
evaluation of Dyloject issue, all the conditions to the offer
had not been satisfied.
"Neither Hospira nor Discus has identified the condition or
conditions to completion of the tender offer that Javelin has
failed to satisfy," Javelin said in a statement.
Javelin alleged that Hospira and Discus failed to accept
and pay for Javelin shares tendered through May 18 and also
breached the terms of a loan agreement that the companies
entered into in April.
Under the loan agreement, Hospira was obligated to provide
Javelin an additional loan of $2 million on June 1, the company
Javelin said it sought to compel Hospira and Discus to
complete the agreed-upon merger.
Shares of Javelin were down 13 percent at $1.32 in morning
trade on the American Stock Exchange. Hospira shares were
trading up 1 percent at $52.30 Thursday on the New York Stock
(Reporting by Anand Basu in Bangalore; Editing by Vyas Mohan)