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Tuesday, March 31, 2015

Teva To Acquire Auspex for $3.2 Billion

By Jason Napodano, CFA

On March 30, 2015, Teva Pharmaceutical (NYSE: TEVA) and Auspex Pharmaceuticals (Nasdaq: ASPX), announced that they have entered into a definitive merger agreement under which Teva will commence a tender offer for all of the outstanding shares of Auspex at $101.00 per share in cash, representing total consideration of approximately $3.2 billion in enterprise value and approximately $3.5 billion in equity value. The transaction has been unanimously approved by the Boards of Directors of both Teva and Auspex, and key shareholders of Auspex have entered into agreements indicating their support for the transaction.

We Initiated Coverage of Auspex in November 2014 at $26 per share. In 4 1/2 months the call returned just shy of 300%, so we're taking a little victory lap and lowering our rating to ‘Hold’ at the take-out price.We expect the deal to close around the middle of the year.

PS - Special thanks to John Tucker, PhD for this help on the initiation report!

1 comment:

  1. You are so deserving of the victory lap. And a victory dance. And some celebratory jumping up and down. Thank you for all that you do for those of us in the biotech sector Jason!