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Johnson & Johnson's $6.5B Deal To Buy Momenta: What You Should Know

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Johnson & Johnson's $6.5B Deal To Buy Momenta: What You Should Know

Johnson & Johnson (NYSE: JNJ) and Momenta Pharmaceuticals, Inc. (NASDAQ: MNTA) announced Wednesday a definitive agreement for Johnson & Johnson to acquire for $52.50 per share in cash. 

After some slackness in the first half of the year amid the economic setback triggered by the COVID-19 pandemic, M&A in the biotech space is slowly picking up.

The J&J-Momenta Deal Terms: The purchase price is 70% above the $30.81 Tuesday closing price for Momenta shares. 

The total equity value of the deal works out to $6.5 billion.

The transaction, which is structured as a tender offer, has been approved by the boards of both companies.

The companies expect the deal to close in the second half of 2020.

The J&J-Momenta Deal Logic: The proposed deal will bring autoimmune disorder and rare disease clinical-stage assets into J&J's stable.

Momenta's lead drug is a Phase 3 asset, nipocalimab, which is an anti-FcRn antibody being evaluated for warm autoimmune hemolytic anemia. It also being evaluated in separate midstage studies in hemolytic disease of the fetus and myasthenia gravis.

A second asset codenamed M254 is being evaluated in a Phase 2 study in immune thrombocytopenic purpura. It is also being studied in an early stage trial in chronic inflammatory demyelinating polyneuropathy.

"Programs such as nipocalimab have the potential to improve the lives of countless patients suffering from autoimmune and fetal maternal diseases," Momenta CEO Craig Wheeler said in a statement. 

"This acquisition provides strong value for our shareholders and ensures a level of investment in our exciting portfolio that will further enhance its potential for patients." 

JNJ, MNTA Price Action: Momenta shares were jumping 69.30% to $52.16 at last check Wednesday. Johnson & Johnson shares were up 0.53% at $150.88. 

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