Alpharma shares skyrocket on King's buyout offer

King Pharmaceuticals will try and join the billion-dollar buyout club with a $1.38 billion cash offer for Alpharma. King is offering $33 a share, a 37 percent premium on Thursday's close and a 49 percent premium over the share price on August 4, when it revealed its offer to Alpharma's board. Alpharma's directors voted to reject the offer, but King won't take no for answer. The company says it is ready to get hostile if necessary to push the acquisition through. And that sent Alpharma's shares through the roof this morning, soaring 46 percent.

Up to now, King Pharmaceuticals and Alpharma were competitors angling to seize the lead in a race to introduce new, abuse-resistant therapies for chronic pain. King and Pain Therapeutics have been pushing Remoxy while Alpharma resubmitted its marketing application for Embeda in June. The Fool noted recently that both programs could be approved by the end of the year, leading to hot competition in the first quarter of 2009.

"We believe this compelling combination would create a strong platform for sustainable long-term growth to better address the changing health care industry and provide meaningful, cost-effective medicines that improve the quality of life for patients," said King Pharmaceuticals Chief Executive Brian A. Markison in a statement.

The buyout offer marks the latest in a string of 10- and 11-figure buyout offers in recent weeks, with Roche angling for all of Genentech and BMS bidding for an elusive ImClone.

--see this release [1] for more

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