After initial reports emerged on Saturday about a potential acquisition deal, Gilead Sciences Inc GILD confirmed that it's set to purchase Immunomedics Inc IMMU.
According to a company statement on Sunday, Gilead is anticipating the close of this definitive agreement sometime in the fourth quarter of the year.
What Happened: Gilead announced that the acquisition deal is valued at $21 billion, and it would acquire the biopharma company for $88 per share, that is, at a 108% premium on Immunomedics closing price on Friday.
Of the total consideration, approximately $15 billion will be paid in cash and the balance through a new debt issue.
The merger will be routed through one of Gilead’s wholly-owned subsidiary by way of a tender offer.
Why Does It Matter: The merger deal will give Gilead access to Trodelvy – a drug for breast cancer, which received accelerated approval from the Food and Drug Administration in April.
Although additional compliances for Trodelvy are underway, the company expects full approval in the U.S. sometime in the next quarter.
According to the statement, Immunomedics would file for approvals with the European regulators in the first half of next year.
“We will now continue to explore its potential to treat many other types of cancer, both as a monotherapy and in combination with other treatments,” Gilead CEO Daniel O’Day said.
Price Movement: Giliead stock cloesd 2.84% higher at $65.58 per share on Friday, however, it dropped by a marginal 0.12% during the after-market trading hours.
Immunomedics shares gained 0.76% to close at $42.25, the same day.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.