AstraZeneca's ZS Pharma deal totals $2.7B

AstraZeneca is acquiring the company in an all-cash tender offer, a deal that gains it a potential treatment for hyperkalemia

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LONDON—AstraZeneca has inked a definitive agreement with ZS Pharma to acquire the San Mateo, Calif.-based biopharmaceutical company. The deal is an all-cash tender offer for all outstanding shares of ZS Pharma common stock at $90 per share, followed by a merger in which all remaining shares not tendered to the offer would be converted into the same $90 cash per share consideration. The transaction will have an aggregate value of approximately $2.7 billion. The transaction is expected to close by the end of the year, subject to customary conditions, including the tender of a majority of ZS Pharma's outstanding shares and the expiration or early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act. ZS Pharma's board of directors unanimously approved the transaction.
ZS Pharma, which is applying its proprietary ion-trap technology to develop novel treatments for hyperkalemia, brings with it ZS-9, a potassium-binding compound that could be a best-in-class treatment for the condition. The compound is in regulatory review by the U.S. Food and Drug Administration and a submission for European Marketing Application authorization is planned by the end of this year. Should ZS-9 be approved, it's estimated that it could see global peak sales of more than $1 billion annually.
“Hyperkalaemia can be a life-threatening condition for patients with chronic kidney disease and chronic heart failure, however the risk is underappreciated and prevalence is increasing. This acquisition complements our strategic focus on Cardiovascular and Metabolic Disease by adding a potential best-in-class treatment to our portfolio of innovative medicines. We look forward to welcoming the ZS Pharma team to AstraZeneca,” Pascal Soriot, CEO of AstraZeneca, said in a press release regarding the deal.
Following completion of the acquisition, ZS Pharma will become a wholly owned subsidiary of AstraZeneca. AstraZeneca does not expect the transaction to affect its financial guidance for 2015, and forecasts that the deal will cause minimal earnings dilution over 2016 and 2017 and become accretive to core earnings by 2018.
“This agreement will allow us to maximize the potential of ZS-9, drawing on AstraZeneca’s long-standing expertise in developing and commercializing medicines for cardiovascular and metabolic diseases,” Robert Alexander, CEO of ZS Pharma, commented in a statement. “We look forward to joining AstraZeneca and to working together to bring this important treatment for hyperkalaemia to the global market, helping to meet an important unmet medical need for patients.”
SOURCE: AstraZeneca press release

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