Elan (NYSE: ELN) has found someone to take Elan Drug Technology (EDT) off its hands after all.

Back in 2008, Elan put EDT up for sale but couldn't find a buyer for the unit that helps companies make extended-release versions of their drugs. And last year the company said it planned to spin out the unit once the IPO market was in better shape.

But Alkermes (Nasdaq: ALKS) has swooped in and agreed to buy EDT for around $960 million. Alkermes will pay $500 million in cash and the rest in stock, which will give Elan a 25% stake in Alkermes.

The fit seems perfect for Alkermes, which also has an extended-release platform. It receives royalties from Johnson & Johnson's (NYSE: JNJ) Risperdal Consta and will get the same from Amylin Pharmaceuticals (Nasdaq: AMLN) and Eli Lilly's (NYSE: LLY) Bydureon if the companies can get it on the market.

The addition of royalties from drugs such as Johnson & Johnson's Invega Sustenna and Acorda Therapeutics's (Nasdaq: ACOR) Ampyra should double or more Alkermes's revenue. The new entity will be cash flow positive from the start and expects to see double-digit revenue grow starting in 2013.

While Elan might be giving away EDT a little cheaper than it would have hoped, the deal is generally positive for the company. It gets some much needed cash to pay off debt and retains the faster growing neurology business. The new company is a pure play on Tysabri, which it sells with Biogen Idec (Nasdaq: BIIB), with a pipeline of mostly Alzheimer's disease drugs.

It may have taken them awhile to find each other, but Alkermes and EDT look like a pretty good match.

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