Shares in FuturaGene jumped 30% after the biotechnology group revealed it had agreed an offer, at a hefty premium, from its Brazilian partner Suzano Papel e Celulose.

Suzano has bid �59.2m ($88m) in cash for FuturaGene, valuing shares in the UK genetic research and development group at 90p.

The offer - which follows an announcement from FuturaGene in February of an approach offering little premium � is pitched 35% above the closing price of the shares on Wednesday.

However, the stock has performed poorly over the last two months, leaving Suzano's offer only marginally above where FuturaGene shares stood at the time of the February statement.

Deeper in the red 

Mark Pritchard, the FuturaGene chairman, said that offer, which has been recommended by the board, represented an endorsement of the group's progress in genetic technologies aimed at raising yields, and developing crops able better to withstand arid and salty conditions.

"We have further consolidated our position with a number of key licensing agreements," Mr Pritchard said, terming 2009 a "year of excellent progress".

"This has been clearly demonstrated by the cash offer."

While the group, which also unveiled anual results, said revenues quadrupled last year, they remained small, at �181,000.

The soaring costs of developing FuturaGene's products, and getting them to market, widened the group's after-tax loss by 40% to �2.18m.

Capital gains 

Suzano said that the combination of its own research with FuturaGene's would release "synergies in the research and development forest efforts".

Suzano's 500,000-hectare land holdings include large stands of eucalyptus, a tree which, with alfalfa, corn, cotton and poplar, is a core area for FuturaGene research.

The Brazilian group already owns 7.1% of FuturaGene, trimming to �55m the outgoings needed to pay for the deal.

Other major FuturaGene shareholders include Mr Pritchard, who owns 6.0%, entrepreneur Iraj Parvizi, with a 15.7% stake, and the International Institute of BioScience Research and Development, a Delaware corporation, which has a 7.6% holding.

The deal stands to make a healthy profit for investors who backed a �3m cash call, priced at 50p a share, in December.