updated 11/19/2007 9:22:16 AM ET 2007-11-19T14:22:16

Celgene Corp. has agreed to acquire Pharmion Corp. for $72 a share in a cash-and-stock deal worth $2.9 billion, the companies said Sunday.

Celgene said the deal furthers its strategy in the hematology/oncology field and brings together three medical therapies _ Revlimid, Thalomid and Vidaza _ that are expected to accelerate revenue and earnings growth over the next five years.

Under the deal, each share of Boulder, Colo.-based Pharmion will be exchanged for $25 in cash and a number of Celgene shares to be determined by an exchange ratio. Upon closing, Pharmion stockholders will own 6 percent of Celgene's outstanding shares.

Summit, N.J.-based Celgene said it expects the deal to be slightly dilutive to 2008 earnings but to add to earnings beginning in 2009.

The companies said the deal has been approved by both boards and is expected to close by the second quarter of 2008, subject to customary closing conditions and certain regulatory approval.

Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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