Eurand agrees to be acquired

The European drug developer Eurand NV said today that it has agreed to a buyout offer of about $583 million in cash from a privately held rival, Axcan Holdings Inc.

The deal for Eurand, whose U.S. commercial headquarters are in Yardley, would add a range of existing and potential drugs to Axcan's portfolio of products.

Axcan Holdings Inc., parent company of Birmingham, Ala.-based Axcan Intermediate Holdings Inc., is a privately held drug developer focusing on gastrointestinal conditions. Eurand, based in Amsterdam, makes a range of drugs focusing on gastrointestinal, cardiovascular, and pain conditions.

Under the deal, Axcan will pay $12 per Eurand share, marking a 9.4 percent premium to Tuesday's closing price of $10.97.

Eurand's shares rose 90 cents, or 8.2 percent, to $11.87 in morning trading today.

The transaction is expected to close in the second quarter of 2011, provided that it gets regulatory approval and a minimum of 80 percent of Eurand's shares are tendered.

To reach the threshold, a majority of the shares held by shareholders other than Eurand's chairman and CEO, Gearoid Faherty, and affiliates of Warburg Pincus also must be tendered. Affiliates of Warburg Pincus own about 55 percent of Eurand's outstanding stock, while Faherty owns about 3.7 percent. Both of those parties agreed to tender their shares.

Faherty will remain chairman and CEO of Eurand through the end of 2010. At that time, John J. Fraher, currently chief commercial officer of Eurand, will become CEO and Angelo C. Malahias will become non-executive chairman.

Axcan said it secured debt financing from BofA Merrill Lynch, Barclays Capital and RBC Capital Markets.