Genzyme Corp. moved Wednesday to acquire all shares of itssubsidiary, IG Laboratories Inc., in a stock swap worth more than$14 million.
Genzyme, of Cambridge, Mass., already owns 69 percent of IGLaboratories' approximately 10 million shares and has offered to buyout its Framingham, Mass., subsidiary by exchanging .12368 sharesof Genzyme common stock for each of the remaining 3 millionshares.
Stockholders of IG Laboratories, also known as Integrated Genetics,would get about $4.76 per share based on the $38.50 price ofGenzyme shares Tuesday before the deal was announced. The swapwould require Genzyme to issue about 370,000 new common shares.
The deal completes a buy back of IG by Genzyme, which acquiredthe genetic testing company in 1990 and then took it public.
Stephen Push, Genzyme's vice president of corporatecommunications, said the proposed buy out was prompted by IG'sneed for additional financing to continue its research anddevelopment programs, especially the company's fetal cellseparation technology.
Last Friday when IG's directors announced they were consideringvarious alternatives to bolster their cash position, Push said Genzymemade its proposal. IG's stock (NASDAQ:IGLI) was trading at $3.69on Feb. 9. It closed Wednesday at $4.37, down 50 cents. Genzymefinished Wednesday at $38.75, up 25 cents.
In addition to developing genetic tests for medical uses, IG ownsGenetic Design Inc., which provides genetic identity testing forforensic purposes.
Genzyme's acquisition proposal will not be final until approved byIG's board of directors and stockholders. The exchange ratio on thestock swap also could be adjusted depending on Genzyme's stockprice at the completion of the deal. _ Charles Craig
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