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Celera acquires Axys
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June 13, 2001: 8:16 p.m. ET
Celera Genomics acquires Axys for $174M to expand into drug discovery
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NEW YORK (CNNfn) - Celera Genomics has agreed to acquire Axys Pharmaceuticals Inc. for about $174 million in stock as part of its plan to expand into drug discovery.
The companies said Wednesday Axys shareholders will receive 0.1016 share of Celera stock if Celera's 10-day average share price is between $45.77 and $48.23 up until two days prior to the deal closing. If the price falls below the collar range Axys shareholders will get $4.65 per share, and $4.90 if it is above.
Celera (CRA: Research, Estimates) shares closed up 60 cents to $42.35 on Wednesday, while Axys (AXPH: Research, Estimates) rose 91 cents to $4.36.
"Building on its genomic and proteomic platform, Celera is now focused on the identification and evaluation of therapeutic targets that could form the basis of potential new treatments or cures for human disease," said J. Craig Venter, Ph.D., Celera president and chief scientific officer.
Venter will remain as top exec after the merger.
"Axys is a very nice addition to Celera's drug discovery business," said James Reddoch, an analyst at Banc of America Securities. "It gives them a jump start in coming up with small molecule compounds for the targets they will be generating."
In a conference call with investors, Venter said the company needs to build or acquire expertise in target validation -- identifying one gene out of several genes associated with a disease that, if turned off, can cure the disease.
"By getting their owned skilled team, Celera can begin to tie together their massive data base with a research base and begin developing compounds on their own," said Daniel Morgan, portfolio manager at Noble Financial Group in Boca Raton, Fla. "That's all to the good and will help diversify their revenue base." 
from staff and wire reports
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