Shareholder proposes buying Northstar Neuroscience for $2.25 per share

By Lisa Kerner

Charlotte, N.C., July 2 - Tang Capital Partners, LP said it made a proposal to acquire Northstar Neuroscience, Inc. in a negotiated transaction for $2.25 per share in cash.

The offer is not a proposal to acquire the stock of Northstar directly from the shareholders in a tender offer, a letter from Tang to Northstar's board of directors stated. The letter was included in a news release.

According to Tang, the per-share offer price is a 50% premium to the closing price of the Seattle-based medical device company's common stock on July 1.

Tang, an 18% shareholder, noted that the transaction is not subject to any financing condition.

Northstar was asked to reply to the proposal on or before July 9 and would then be expected to enter into a binding definitive merger agreement on or before July 23.

A Northstar statement said the company's board of directors will review the offer consistent with its fiduciary duties.

In addition, Northstar announced it will evaluate strategic alternatives with the assistance of Leerink Swann.

Tang is a San Diego, Calif., investment fund focused on the life sciences industry.

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