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Endo International to Acquire Auxilium for $2.6 Billion

Endo InternationalEndo International (NASDAQ:EDNP) based in Ireland will acquire Auxilium Pharmaceuticals (NASDAQ: AUXL) in a stock and cash deal worth $2.6 billion, only weeks after a lower bid had been rejected by Auxilium.

The board at Auxilium embraced the most recent offer but shareholders have yet to vote.

On Thursday, Endo said it would pay in cash and stock $33.25 for each share of Auxilium Pharmaceuticals (NASDAQ: AUXL). The price represented a premium of 55% on the closing price of Auxilium Pharmaceuticals (NASDAQ: AUXL) as of September 16, which was when Endo announced publicly its attempt to acquire Auxilium.

Initially, Endo International (NASDAQ:EDNP) offered a per share price of $28.10 in a bid that valued the pharmaceutical company at $2.2 billion. That bid as does the revised one, includes the assumption of Auxilium debt.

However, Auxilium said September 22 that the first bid undervalued the business and recommended that its shareholders vote for an all-stock, separate deal with QLT, Inc. an eye drug maker in Canada.

Auxilium, which is Chesterbrook, Pennsylvania based, also said following the announcement by Endo of the initial bid that its board adopted a shareholder’s rights plan known as the poison pill to discourage any unsolicited takeovers.

This past Friday, Auxilium Pharmaceuticals (NASDAQ: AUXL) announced it ended its proposed union with QLT. The two boards of Auxilium and Endo then unanimously approved the higher offer from Endo.

If the shareholders at Auxilium Pharmaceuticals (NASDAQ: AUXL) approve of the deal, the two companies expect it to close in the first six months of 2015.

In the new deal, shareholders at Auxilium are able to choose a deal that is all-stock, all-cash or a combination of the two.

Auxilium has struggled of late due to lower sales of Testim is testosterone gel and said in September it would cut jobs in an attempt to slash its costs by $75 million annually.

Auxilium Pharmaceuticals (NASDAQ: AUXL) also manufactures Xiaflex, which has been approved to treat two very rare conditions: Dupuytren and Peyronie’s Disease.

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