Actavis to acquire Durata Therapeutics for $675 million

In a move that takes it further out of its main generics business, Ireland-headquartered Actavis (NYSE: ACT) has entered into a definitive agreement to acquire the USA’s Durata Therapeutics (Nasdaq: DRTX). Durata’s shares rocketed more than 77% to $24.60 in pre-market trading this morning.

Under the terms of the accord, a subsidiary of Actavis will commence a tender offer to acquire all of the outstanding shares of Durata common stock for $23.00 per share (a 66% premium to Durata's Friday closing price of $13.88) in cash, or around $675 million in the aggregate, and contingent value rights (CVRs) entitling the holder to receive additional cash payments of up to $5.00 per share if certain regulatory or commercial milestones related to Durata's lead product Dalvance (dalbavancin) are achieved.

Actavis expects the acquisition to be accretive by the end of the first year. The company anticipates closing the transaction in late 2014 or early 2015. Following the completion of the deal, Durata will merge with and become a subsidiary of Actavis and Durata's shares will be delisted from Nasdaq.