NEW YORK, Feb. 19 - Sample preparation firm Cytyc will acquire diagnostics company Digene in a stock and cash deal worth $77 million, the companies said on Tuesday
Under the deal, Cytyc will issue 23 million shares of common stock, and Digene shareholders will receive $4.00 in cash and 1.1969 shares of Cytyc for each share of Digene owned.
Based on Friday's closing chare price on the Nasdaq, the deal will provide shareholders with a 13 percent premium.
The transaction will result in a one-time charge of up to $65 million and is subject to the tender of more than 50 percent of Digene's stock. It is expected to close during the second quarter of the year.
Both Cytyc, of Boxborough, Mass., and Digene develop diagnostics related to cervical cancer: Cytyc is working on an automated system for pap testing, and Digene's test detects human papilloma virus, which is linked to cervical cancer.
The acquisition will allow the Cytyc collection system and the Digene hybrid capture testing technology to be combined, said Cytyc chief executive officer Patrick Sullivan in a statement. According to the company, that combined approach has shown to be useful for patients with borderline cytology results.
Digene, based in Gaithersburg, Md., uses genomics research to develop tests for sexually transmitted diseases and other conditions.