Leverkusen-based Bayer announced on December 19 it had raised its bid for Norwegian company Algeta, with a view to eventually being in full control of the cancer drug Xofigo, which the German pharmaceutical firm believed had a huge market potential.

Bayer offered 1.9 billion euros ($2.6 billion) to buy the cancer treatment specialist from Oslo, up from an earlier bid of 1.8 billion euros.

"The Bayer group plans to further strengthen its oncology portfolio with the acquisition of Algeta," the company said in a statement. "We have reached agreement with Algeta's board of directors to make a recommended voluntary public takeover to shareholders and are offering them 362 kronor per share in cash."

Favorable deal for shareholders

Bayer states the offer represented a premium of 37 percent over the closing price on November 25, the day before Algeta confirmed it had received a preliminary acquisition proposal.

Bayer and Algeta have cooperated in the development of Xofigo since 2009. The German firm's CEO, Marijn Dekkers, said he saw a huge potential in the drug, expecting it to secure an annual turnover of more than one billion euros.

The planned takeover is subject to regulatory approval, with the transaction due to be completed in the first quarter of 2014.

hg/jr (AFP, Reuters)