Ramius tempts Cypress shareholders with sweetened offer

Ramius isn't taking 'no' for an answer after Cypress Bioscience's board opted to reject its buyout offer. In a carefully worded letter, which the hedge fund operator was equally careful to make public, Ramius says that it may even be open to offering more than $4 a share--a figure that Cypress (CYPB) has spurned as grossly inadequate--after it gets a close look at the books and management decides to negotiate a deal.

"The clear message we have received from a large number of shareholders is that shareholders want maximum value for their shares now through a negotiated transaction and that this is clearly a better alternative than management continuing with its current strategy," said Ramius Partner Managing Director Jeffrey Smith.

Ramius also reiterated its willingness to hand over a 50 percent interest in Cypress's BL-1020, an antipsychotic, provided management or some other third party funded the trial. That gives its offer an "implied value" of $4.39. At $4 a share the company would be worth $150 million. So far, though, investors haven't bought on to the idea that Ramius will win out, with the stock trading well under Ramius' offer.

- here's the Ramius release
- check out the report from Dow Jones