Buy low, Celator

The acquisition of Celator Pharmaceuticals Inc. (NASDAQ:CPXX) by Jazz Pharmaceuticals plc (NASDAQ:JAZZ) shows that timing is everything. Hedge funds that poured into the stock following positive Phase III data in March got a rapid 3x return. But at least one investor who bought Celator during its days as a public microcap is seeing 12x, better than two VCs that invested in 2007.

Jazz is paying $1.5 billion in cash for Celator, or $30.25 per share. The price is a 72% premium to Celator's close of $17.53 on May 27, the last trading day before the deal was announced...