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Market hails Alexza Pharmaceuticals and Ferrer deal

Last updated: 00:06 11 May 2016 AEST, First published: 19:06 10 May 2016 AEST

Pictured - a done deal - an executive handshake, representing today's news
The pair have struck a deal in which subsidiary Ferrer Pharma Inc will acquire Alexza for $0.90 per share in cash - a 210% premium to Alexza's closing share price on February 26 this year.

Investors in Alexza Pharmaceuticals Inc (NASDAQ: ALXA) cheered as the firm shot up over 66% to US$0.90 in New York as it agreed to be bought by Ferrer.

The pair have struck a deal in which subsidiary Ferrer Pharma Inc will acquire Alexza for $0.90 per share in cash -  a 210% premium to Alexza's closing share price on February 26 this year

That was the trading day before the announcement that Alexza and Ferrer had entered into a non-binding letter of intent.

"We see Ferrer as the ideal company to acquire Alexza as we continue to strive toward global commercial success with ADASUVE and to re-energize our Staccato-based product pipeline," said Thomas B. King, president and chief executive of Alexza. 

"Over the past four years, we have come to appreciate their professionalism, passion, dedication and commitment to Alexza's technologies, products and people. 

"With this combination, we feel that Alexza's products will be well positioned for long-term success in serving important patient needs."

As well as the upfront cash payment, Alexza stockholders will be granted contingent value rights to receive cash payments in four payment categories if specified milestones are achieved following the closing. 

The transaction is expected to close in the second quarter of 2016 and is subject to normal conditions.

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