Drug delivery company CIMA Labs in Brooklyn Park, Minnesota, will come under Israeli firm Teva Pharmaceutical (Nasdaq: TEVA) as part of Teva's acquisition of CIMA parent company Cephalon (Nasdaq: CEPH), a pharmaceutical company which is based in Frazer, Pennsylvania.

Teva and Cephalon announced today that Teva will pay $81.50 per share of each outstanding Cephalon share, making the deal worth about $6.8 billion. The deal is expected to close in the third quarter and will require no financing. Teva is paying a 39 percent premium to buy Cephalon based on the company's closing stock price on March 29, the last closing price before the unsolicited proposal was announced.

The companies announced that the acquisition would provide cost synergies of $500 million and broaden Teva's reach into therapeutic areas including CNS, oncology, respiratory,Teva di and pain management. The combined company's sales are about $7 billion based on branded portfolio drugs already available and more than 30 late-stage compounds being developed.

"This is transforming for Teva's branded business, as it will help us to deliver on our strategic goal of creating a diversified, multi-faceted company," said Shlomo Yanai, president and CEO of Teva, in a statement."We have been following Cephalon for a long time and are very happy with the opportunity to join forces."

"Cephalon's merger with Teva is the result of a rigorous process that included a review of a wide range of strategic options undertaken by Cephalon's Board of Directors and management team to maximize value and deliver significant returns to shareholders," said Kevin Buchi, Cephalon's CEO, in a statement.

Cephalon acquired CIMA Labs, the Minnesota entity, in 2004. CIMA Labs also has manufacturing facilities in Eden Prairie, Minnesota, and Salt Lake City, Utah. In Europe, its R&D operations and manufacturing facility are in France.