GlaxoSmithKline (NYSE: GSK) has agreed to buy Human Genome Sciences Inc. for $14.25 a share in cash, winning control of its U.S. partner on the Benlysta lupus treatment after a three-month takeover battle.
The deal values Human Genome at about $3.6 billion on an equity basis, or $3 billion net of cash and debt, London-based Glaxo said today in a statement.
Earlier, Reuters reported that GSK had upped its share offer by $1 to $14 for a total purchase price of some $2.8 billion.
HGSI shares closed Friday at $13.58.
GSK has been pursuing HGS (Nasdaq: HGSI) for three months and had resisted raising its officer. HGS had sought another buyer.
Directors of both companies have approved the deal, the companies said.
HGS agreed on the takeover following a prolonged battle in which it had put up a “poison pill” defense which would have diluted holdings if anyone attempted to acquire 15 percent or more of its stock without board approval.
Under the agreement, GSK said it gains full ownership of the drugs Benlysta for lupus, albiglutide for Type 2 diabetes and darapladib which is a possible treatment for atherosclerosis.
GSK’s higher offer followed the release of data from a cardiac safety study which was positive for albiglutide.
“After a thorough analysis of strategic alternatives, HGS has determined that a combination with GSK is the best course of action for our company and the best way to maximize value for our stockholders,” said H. Thomas Watkins, president and CEO of HGS.
GlaxoSmithKline said it expects at least $200 million in cost synergies to be realized by 2015, and expects the transaction to be accretive to core earnings beginning next year.
GSK operates its U.S. headquarters in RTP.
(Bloomberg news and The AP contributed to this report.)
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