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Lion Bioscience to Acquire Trega for $35 Million

NEW YORK, Dec 27 - Lion Bioscience will acquire Trega Biosciences in a deal valued at $35 million, the companies announced Wednesday.

Under the terms of the agreement, Lion will issue new shares out of its authorized capital to acquire all outstanding shares of Trega in a stock-for-stock transaction using Lion's American Depositary Shares.

The agreement values Trega at an estimated $1.35 per share on a fully diluted basis and presumes that Lion’s average closing price per ADS will be between $68 and $92 at the time of the sale.

Lion ADS shares closed at $71 and Trega shares closed at approximately $0.69 on Nasdaq on Tuesday.

Lion will provide a stand-by line of credit of $1 million to assist funding Trega's operations until closing, which the companies expect to take place in March or April 2001.

Further terms of the agreement were not disclosed.

Lion said it expects to benefit from Trega's iDEA predictive absorption, distribution, metabolism and excretion simulation system. The system, which simulates how drug candidates will be processed in humans, will be combined with Lion’s integrated software solutions to develop a line of toxico-genomics and toxicology prediction software, the company said in a statement.

Trega’s ChemFolio small-molecule libraries and other drug discovery capabilities will be added to Lion’s iD3 information-driven drug discovery and diagnostics business, Lion said.

Michael Grey, president and CEO of Trega, will serve as CEO of Lion Bioscience Inc., Lion’s combined U.S. subsidiaries, after completion of the transaction.

Grey said, “Not only will the combined company be able to provide a comprehensive range of tools that span the drug discovery continuum, but it also has the potential to revolutionize how drug discovery is conducted in the future."

" This transaction will further strengthen Lion's strategic position as a leading provider of comprehensive solutions for enterprise-wide data integration and management in the life science R&D sector," Friedrich von Bohlen, Lion CEO, said in a statement. " We intend to strengthen and build on this San-Diego-based organization to expand Lion's U.S. presence and serve our partners worldwid e."