Salix Pharma will buy Santarus for $2.12 billion

AP News
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Posted: Nov 07, 2013 5:29 PM

NEW YORK (AP) — Salix Pharmaceuticals will buy Santarus for about $2.12 billion to add to its roster of drugs focused on gastrointestinal disorders.

Salix will pay $32 per share for Santarus' stock, the drugmakers said Thursday, valuing Santarus at $2.6 billion including debt.

The combined company would be on pace for more than $1 billion in annual sales. Salix said it will have a strong position in the gastrointestinal drug market with a more diverse array of products.

Salix Pharmaceuticals Ltd., based in Raleigh, N.C., is paying a 38 percent premium to Santarus Inc.'s closing price of $23.22 Thursday.

The boards of both companies have approved the deal and say they expect the sale to close during the first quarter.

Salix shares, up 76 percent in 2013, added another $6.69, or 9.4 percent to $78 in aftermarket trading, while Santarus stock added 37 percent to $31.90. Santarus shares had already more than doubled this year.

Salix expects about $920 million in revenue in 2013. Its biggest seller by far is Xifaxan, a treatment for traveler's diarrhea and neurological problems associated with liver failure. Other products include the ulcerative colitis drug Apriso, and constipation drug Relistor.

San Diego-based Santarus sells Glumetza for diabetes, Zegerid for acid reflux and Uceris for ulcerative colitis. Revenue in the nine months through September more than doubled to about $268 million. In August, it predicted sales of $355 million to $360 million for the year.