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Deals

Sorrento surges on a near $1 billion takeout offer

(Reuters) - Sorrento Therapeutics Inc SRNE.O said on Friday it had received a proposal from a private equity fund interested in acquiring a majority or all of its outstanding shares, valuing the company at as much as $993 million.

Shares of the company surged 67.74% to $5.72 before the bell, after the drugmaker said it was reviewing the non-binding proposal of up to $7 per Sorrento share.

The market capitalization of the company, which has one therapy, ZTlido, approved in the United States for relieving nerve pain following shingles infection, stood at about $483.8 million as of Thursday’s close.

The San Diego-based company did not disclose the name of the private equity fund and did not respond immediately to Reuters request for the name.

The proposal comes a few months after the cancer therapy developer rejected an unsolicited buyout proposal from two pharmaceutical companies which offered between $3 and $5 for each of Sorrento’s outstanding shares.

Sorrento added ZTlido as part of its 2016 acquisition of majority stake in privately held SCILEX Pharmaceuticals Inc.

Reporting by Manojna Maddipatla in Bengaluru; Editing by Shinjini Ganguli

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