ZymoGenetics Inc. (ZGEN) shares shot up more than 84 percent on Wednesday trading, on news that drug giant Bristol-Myers Squibb co. (BMY) will acquire the Seattle-based biotech for $9.75 a share, or $885 million, to gain full ownership of a hepatitis C drug the companies are jointly developing. The buyout price represents an 84% premium over ZymoGenetics Tuesday’s closing price of $5.30 per share.
“The acquisition of ZymoGenetics brings us full ownership of a promising investigational biologic that strengthens our very diversified hepatitis C portfolio”, said Bristol-Myers Squibb CEO Lamberto Andreotti, in a statement.
“By joining forces with Bristol-Myers Squibb, we believe we will enhance the long-term potential of ZymoGenetics’ portfolio of assets, while providing a compelling valuation for our shareholders,” said Douglas E. Williams, Ph.D., chief executive officer of ZymoGenetics. ”
Bristol-Myers expects the acquisition to trim its earnings by about 3 cents a share in 2010, and about 7 cents a share in 2011.
The deal has been has been unanimously approved by the boards of both companies.
ZGEN gained $4.45, or 84.06 percent, to $9.76 at 12:42 p.m. ET in Nasdaq trading. BMY advanced 28 cents, or 1.03 percent, to $26.89.