Genzyme's planned acquisition of Vivigen Inc. is still valued atthe $40 million mark set nearly six weeks ago, but it couldbecome a bit more costly in terms of the number of GenzymeCorp. shares that will be given up to acquire the clinicaltesting company.

A definitive agreemeent announced this week for Genzyme'sacquisition of Vivigen sets the deal's value at $40 million, butpegs the exchange of Vivigen stock for Genzyme shares onGenzyme's share price in the days before the deal's closing,expected some time in November.

Since the deal was announced on July 20, the price ofGenzyme's stock (NASDAQ:GENZ) has tumbled 22 percent, from$53.75 a share to its close on Tuesday of $42, for what appearto be unrelated reasons. If Genzyme stock hovers around $42before the deal is closed, between 950,000 and 1 millionGenzyme shares would be exchanged for Vivigen'sapproximately 2.6 million shares.

The initial agreement in July called for the exchange of 0.3106of a share of Genzyme for each Vivigen share, or a total ofabout 800,000 shares. It was subject to adjustment ifGenzyme stock traded outside a range of $42 to $57 a share.Genzyme had about 21.1 million shares outstanding as of June30.

Vivigen of Santa Fe, N.M., is expected to become a whollyowned subsidiary of Genzyme, but be managed as a subsidiaryof IG Laboratories Inc. (NASDAQ:IGLI) of Framingham, Mass., agenetic testing company that is majority-owned by Genzyme ofCambridge, Mass.

The deal was structured for Genzyme to acquire Vivigen toqualify the transaction as a tax-free pooling of interest.

Genzyme's stock price has not recovered from a sharp retreatin early August, which appeared to be triggered by an analyst'sglum forecast of slower sales growth, rising overhead andstock dilution resulting from possible buy-back of productrights.

Vivigen (ASE:VIV) closed Tuesday at $14.88, up 12 cents afterrising $1.75 on Monday, and IG Laboratories closed at $9.75 ashare, down 25 cents.

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