PDL BioPharma Inc. said on Thursday it plans to spin off its biotechnology assets into a separate entity and pay shareholders a special $500 million or $4.25 a share dividend.
PDL decided to separate its antibody drug royalties from its biotechnology operations and stated it will capitalize the new company with $375 million in cash.
The company said the initial infusion of money along with potential milestone payments, royalties, and the sale of the company's cardiovascular products will fund the biotech spinoff for about 3 years.
After the spinoff it will continue to hold rights to royalty revenue on all future and current licensed products. It expects 2008 antibody revenue ranging from $240 million to $260 million.
PDL expects the asset separation to be concluded by the end of 2008. May 5 is the record and dividend payment date to shareholders .
PDL BioPharma Inc. shares were 0.46 cents up or 4.09% at $11.71 on Thursday's trading close.