Piramal Healthcare Limited, one of India's largest pharmaceutical and healthcare companies, has signed a merger agreement with Minrad International, Inc., a provider of generic inhalation anesthetics, to acquire latter.

According to sources, the total consideration for the merger and acquisition of the notes, in cash plus the assumption of debt, will be approximately $40 million.

Under the terms of the agreement, Minrad will merge with a newly incorporated wholly-owned subsidiary of Piramal. If the merger is completed, stockholders of Minrad will receive $0.12 per share in cash.
 
Post acquisition, the combined company will have a marketing and sales network across 108 countries with 178 distributors, capable of supplying anesthetic products to supply chain vendors and end users, including hospitals, pain management clinics, veterinary hospitals, university research centers, and medical industrial users.

In addition with the merger agreement, Piramal has also agreed to buy Minrad's 8% Senior Secured Convertible Notes from the note holders. However, the transaction is conditioned upon approval by Minrad's stockholders and other customary closing conditions.

Market experts believe that the latest move will give Piramal access to key intellectual property for the manufacture of inhalation anesthetics, including process-based intellectual property for both sevoflurane and desflurane, and will provide Piramal an immediate entry into the US market for sevoflurane, the largest selling inhalation anesthetic in the US.

The deal expected to close in the first quarter of 2009.