Jubilant Organosys and Draxis Health have entered into an agreement whereby a wholly owned subsidiary of Jubilant will acquire all the outstanding common shares of Draxis for approximately $255 million.
The Noida, India-based Jubilant said that the purchase price represents a 22.4 percent premium over the April 3 closing price of Draxis’ shares on Nasdaq and a 41.2 percent premium over the closing price of Draxis’ common shares on Nasdaq on March 13, the last trading day on Nasdaq prior to the request by securities regulators to explain increased trading in Draxis’ common stock on March 14.
The transaction was unanimously approved by the board of directors of the Toronto-based Draxis on April 4, following receipt of the recommendation of its special committee, according to the companies.
Draxis’ board said it has resolved to recommend to its shareholders that they vote in favor of the transaction on the basis that it creates immediate value for Draxis shareholders. As well, the board said it expects the transaction to provide operational and technical resources to accelerate the growth of Draxis’ business and its customer base.
The transaction will be carried out by way of a statutory plan of arrangement pursuant to the Canada Business Corporations Act and must be approved by the Québec Superior Court and the affirmative vote of Draxis’ shareholders at a special meeting of shareholders, according to the companies.
“DRAXIS represents a unique opportunity in the North American market, offering Jubilant entry into the attractive, regulated, high growth and high margin radiopharmaceutical business. It also enables Jubilant to consolidate its position in the sterile and non-sterile contract manufacturing business," said Shyam S. Bhartia, chairman and managing director.