(Corrects to remove deal value from headline and paragraph 1)
June 26 Auxilium Pharmaceuticals Inc
would buy Canadian drugmaker QLT Inc to add
QLT's experimental treatment for eye diseases caused by gene
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