Targeted Genetics Surges

The stock rises on news Biogen will increase its stake in the company.
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Shares of

Targeted Genetics

(TGEN) - Get Report

got a boost Tuesday after it said

Biogen Idec

(BIIB) - Get Report

is increasing its stake in the company to 19.9%.

Targeted Genetics saw its stock jump 90 cents, or 41.9%, to $3.05.

Under the agreement, which involves the repayment of $8.15 million in debt, Biogen Idec has agreed to convert $5.65 million of debt into 1 million shares of the gene-therapy company. Targeted Genetics will pay $500,000 of the remaining debt immediately and the remaining $2 million will be paid according to a new schedule.

"We are extremely pleased to have successfully modified the debt arrangement with Biogen Idec. The successful renegotiation of this debt with Biogen Idec reduces our long-term cash needs and strengthens the company financially," said H. Stewart Parker, president and CEO of Targeted Genetics.

Biogen Idec's shares dipped 6 cents, or 0.1%, to $48.35.