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Investing.com -- Avadel Pharmaceuticals plc (NASDAQ:AVDL) stock surged 16% on Friday after the company received an unsolicited acquisition proposal from H. Lundbeck A/S that values the firm at up to $23.00 per ordinary share.
The offer from Lundbeck consists of $21.00 per share in cash at closing plus a non-transferable contingent value right (CVR) worth up to an additional $2.00 per share. The CVR would pay $1.00 per share if LUMRYZ and valiloxybate reach combined annual U.S. sales of at least $450 million by 2027, and another $1.00 if they reach $700 million by 2030.
This new proposal comes after Avadel had already agreed to be acquired by Alkermes plc (NASDAQ:ALKS) on October 22 for up to $20.00 per share. The Alkermes deal included $18.50 per share in cash at closing and a $1.50 CVR contingent on FDA approval of LUMRYZ for treating idiopathic hypersomnia in adults by the end of 2028.
Avadel’s Board of Directors has determined that Lundbeck’s proposal could reasonably be expected to result in a "Company Superior Proposal" as defined in its existing agreement with Alkermes. This determination allows Avadel to engage in discussions with Lundbeck, though the company has not yet changed its recommendation regarding the Alkermes acquisition.
Under Irish Takeover Rules, Lundbeck must either announce a firm intention to make an offer or declare it does not intend to make an offer by the seventh day prior to Avadel’s shareholder meeting to consider the Alkermes deal.
Morgan Stanley and Goldman Sachs are serving as financial advisors to Avadel, with Goodwin Procter LLP and Arthur Cox LLP providing legal counsel. No action is required from Avadel shareholders at this time.
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