Will Deal Price Spark New Bids for Digene?

When Cytyc Corp. announced its $553 million definitive to acquire fellow diagnostic test maker Digene Corp. last Tuesday, some griping about the price surfaced on the conference call announcing the deal, said a Street source. The complainers voiced opinions suggesting Cytyc’s price was too low and other parties might enter the picture. The Street, however, traded the deal normally-it was the same tight spread found on most pending deals these days. The day of the announcement, Digene closed at $27.57 per share, 40 cents below its per-share value in the deal, which exchanges each Digene share for $4 cash plus 1.1969 Cytyc shares. At press time, Gaithersburg, Md.-based Digene closed at $30.05 per share, 21 cents south of its per-share value in the deal. In the fall, though, Digene stock routinely traded in the upper $30s per share. On Oct. 24, for example, the company’s shares traded as high as $37.85 each.