SUMMIT, N.J. ( TheStreet) -- Celgene ( CELG) is acquiring Abraxis BioScience ( ABII) for $2.9 billion in cash and stock to expand its cancer drug business, the company announced Wednesday. Celgene is one of the largest biotech companies in the world, with revenue of $2.7 billion last year coming mainly from drugs like Revlimid used to treat cancers of the blood. By acquiring Abraxis, Celgene gains ownership of a drug used to treat breast cancer patients and expands the company's commercial operations into the solid tumor market. "The acquisition of Abraxis BioScience is an exceptional strategic fit that will accelerate our strategy of becoming a global leader in oncology," said Bob Hugin, Celgene's CEO, in a statement. Under terms of the agreement, each Abraxis share will be exchanged for $58 in cash and 0.2617 of a share of Celgene common stock. The deal values Abraxis at $71.93 a share, or a 17% premium over the stock's Tuesday closing price of $61.31. That's based on Celgene's Tuesday closing price of $53.24. Celgene said the acquisition of Abraxis will be dilutive to adjusted earnings in 2011 and accretive in 2012. Abraxis markets Abraxane, a reformulation of the chemotherapy drug paclitaxel, as a treatment for metastatic breast cancer patients. Abraxis has also shown potential to treat patients with lung cancer and pancreatic cancer. In addition to cash and stock, Abraxis shareholders are eligible to receive additional cash payments if Abraxis is approved for lung or pancreatic cancers. -- Reported by Adam Feuerstein in Boston. Follow Adam Feuerstein on Twitter.