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Pozen Schedules Shareholder Vote on USD 146m Deal to Buy Canadian Drugmaker Tribute.


30 December 2015 - US-based specialty pharmaceutical company Pozen Inc. (NASDAQ: POZN) has scheduled a stockholder meeting in connection with its pending deal to buy Canadian drugmaker Tribute Pharmaceuticals Canada Inc. (TSX Venture: TRX) (OTCQX: TBUFF) for 2 February 2016, the company said.

In June Pozen agreed to acquire Tribute in a transaction valued at approximately USD 146m, the company said.

The combined company was to be named Aralez Pharmaceuticals plc and domiciled in Ireland.

However, the US Treasury has recently released new guidance meant to discourage tax inversions - deals where companies move their headquarters offshore to avoid paying taxes. Ireland has been a favoured location for such headquarters.

Pozen has since formed a new company, Aralez Pharmaceuticals Inc., organised under the laws of British Columbia, Canada.

A Canadian subsidiary of Aralez will merge with Tribute, through a three-cornered amalgamation in a plan of arrangement, with Tribute surviving as a wholly-owned subsidiary of Aralez.

Similarly, an indirect US subsidiary of Aralez will merge with Pozen, with Pozen surviving as an indirect wholly-owned subsidiary of Aralez.

At closing, each share of Pozen common stock will be converted into the right to receive one Aralez common share and each common share of Tribute (other than dissenting shares) will be exchanged for 0.1455 of an Aralez common share.

This exchange ratio remains unchanged from the ratio announced when the parties initially entered into the agreement and plan of merger.

In connection with the acquisition, a syndicate of healthcare investors, led by Deerfield, has committed up to USD 350m in growth capital for the combined company, intended to support the anticipated commercial launch of Yosprala and for future acquisitions.

Such financing is expected to close simultaneously with the closing of the transaction with Tribute.

The proposed investment in Aralez includes USD 75m of equity at a purchase price of USD 7.20 per ordinary share; USD 75m in 2.5% convertible senior secured notes due six years from issuance with a conversion price of USD 9.54 per ordinary share; and up to USD 200m committed senior secured debt facility to fund future acquisitions.

Guggenheim Securities, LLC acted as financial advisor to Pozen in connection with the acquisition and financing transactions. Deutsche Bank Securities Inc. also served as financial advisor to Pozen, with legal advisors DLA Piper LLP in the United States and Canada and A/L Goodbody in Ireland.

Bloom Burton and Co. and KES VII Capital Inc. served as financial advisor to Tribute, with Fogler, Rubinoff LLP serving as legal counsel in Canada, Troutman Sanders LLP in the United States and Walkers in Ireland.

Country: Canada

Sector: Pharmaceuticals

Target: Tribute Pharmaceuticals Canada Inc

Buyer: Pozen Inc.


Deal size in USD: 146m

Type: Corporate Acquisition

Financing: Cash and Stock

Status: Closed

Buyer advisor: Guggenheim Securities, LLC , Deutsche Bank Securities Inc , DLA Piper LLP

Comment: Pozen shareholders to vote on 2 February

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Publication:M & A Navigator
Geographic Code:1CANA
Date:Dec 30, 2015
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