Elan plans $1 billion buyback and acquisitions

DUBLIN (Reuters) - Irish drugmaker Elan (Other OTC: ELNCF - news) will return $1 billion (654 million pounds) to shareholders and seek acquisitions with the proceeds of selling its stake in blockbuster multiple sclerosis (MS) treatment Tysabri to partner Biogen Idec (NasdaqGS: BIIB - news) .

The sale of Tysabri, which was by far Elan's most important product and responsible for almost all its revenue, leaves the company's future shape unclear, but the deal now offers it flexibility to buy new assets.

The company said on Friday it would use almost a third of the $3.25 billion from the deal to buy back shares.

"By unlocking a portion of the Tysabri asset value ... we have a unique opportunity to reward shareholders, diversify our business and create a highly distinctive business platform upon which to advance to the benefit of shareholders and patients around the world," Elan Chief Executive CEO Kelly Martin said.

Elan is already pursuing potential deals for the next 12-18 months, Martin told Reuters in an interview earlier this month, which he said may not necessarily be restricted to the company's past.

The Irish drugmaker has co-marketed Tysabri with the larger U.S. company for 12 years and said it would receive a royalty of 12 percent of Tysabri's global net sales for the first 12 months after the deal is completed.

(Reporting by Stephen Mangan; Editing by Mark Potter)

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Elan plans $1 billion buyback and acquisitions