by Sarah Devin
Beacon Contributing Writer
Javelin Pharmaceuticals Inc. (AMEX: JAV) is a Cambridge, Massachusetts-based specialty pharmaceutical company, engaged in research, development and commercialization of products for the pain management market. Javelin soared in yesterday�s trading, closing up 60.45% at $2.15; volume surged from a daily average of 1.06 million to 23.44 million, spurred by news the company received a binding acquisition offer from Hospira Inc. (NYSE: HSP).
According to the terms of the offer, Hospira and its wholly owned subsidiary Discus Acquisition Corp. will enter into a merger agreement with Javelin. The deal also includes a loan and security agreement and intellectual property security agreements, with Discus commencing an all cash tender offer in order to acquire all of Javelin�s outstanding shares in the market. The shares have been valued at $2.20 per share, subject to certain conditions.
Javelin has already entered into a similar merger agreement with Myriad Pharmaceuticals (NASDAQ: MYRX). Javelin CEO Martin Driscoll said the company has already sent a notice of intent to Myriad to terminate the merger agreement. Per the agreement, both companies have five business (until April 16) days to renegotiate the offer. An ideal situation for Javelin would be that Myriad comes up with a better offer than the one by Hospira.
Awaiting possible renegotiation will drive speculation, though so far there�s no hint as to whether Myriad will sweeten the deal. Javelin�s board of directors has said that the Hospira offer is a �superior proposal,� but the speculation should see some volatility in Javelin shares throughout this week. If in case Myriad does change its terms of offer, we might see a takeover battle ensuing, with possibility of some solid profit making opportunities for traders.
Shares of Javelin took a slow start this morning, up .47% to $2.16 in early trading.
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