Obagi Medical Products Inc. said Wednesday that Canadian drugmaker Valeant Pharmaceuticals boosted its offer to buy the dermatology products maker, topping a bid made a day ago by a German rival.
Obagi said it struck a deal with Valeant Pharmaceuticals International Inc. that calls for it to pay $24 per share, or a total of about $418.3 million, for the company. The news sent Obagi shares up 10 percent in morning trading.
Obagi said its board has approved the deal and is recommending that stockholders tender their shares in Valeant's offer, which is set to expire on April 23. A spokeswoman for Merz didn't immediately return a call for comment.
The sweetened offer came a day after German drugmaker Merz Pharma Group offered to buy Obagi for $22 per share, or about $383.5 million.
Late last month, Valeant agreed to pay $19.75 per share, or a total of about $343.7 million, for Obagi. Merz said Tuesday that it had been in private talks with Obagi before that deal was announced and wasn't aware that it was considering signing a deal with another company so quickly.
Long Beach, Calif.-based Obagi makes skin anesthetics as well as prescription and over-the-counter treatments for wrinkles, acne, sun damage and other skin problems. It posted sales of $120 million last year.
In morning trading, Obagi shares rose $2.19, or 10 percent, to $25.07, while Valeant's U.S. shares edged up 71 cents to $76.08.