Aimmune Shares Surge 170% As Nestle Set To Acquire Company At $2.6B Enterprise Value

Nestle S.A. NSRGY subsidiary Nestle Health Sciences (NHSc) is aquiring biopharma company Aimmune Therapeutics, Inc. AIMT, under a definitive agreement, the latter announced Monday, sending its stock soaring in the pre-market session.

What Happened: NHSc will purchase the stake in Aimmune through its 100% subsidiary Société des Produits Nestlé S.A. (SPN) at an enterprise value of $2.6 billion.

All shares which are currently not owned by Nestle will be acquired at $34.50 per share through a cash tender offer. On completion of the acquisition, Aimmune will be the surviving corporation and SPN will be the merged entity.

If approved, the merger deal is expected to close sometime in the fourth quarter later this year.

Why It Matters: From the $145 million investment in November 2016, NHSc has gradually increased its stake in Aimmune to a 25.6% equity ownership by January 2020. With $473 million investment in total, Nestle holds 19.6% common stocks with voting rights and the balance in non-voting preferred stock.

The acquisition price of $34.50 per share represents a 174% premium to Aimmune’s $12.60 closing price at the end of trading hours on Aug 28.

Through this merger, Nestle expects a boost to not only its organic growth in 2021 but also cash earnings from 2023.

Aimmune currently holds the only Food and Drug Administration-approved treatment that reduces the allergic reactions to peanuts in children aged between 4 years to 17 years.

Price Action: Aimmune shares traded 170.1% higher at $34.03 in the pre-market session Monday.

Photo courtesy: Wiki Historian N Oh via Wikimedia

Posted In: Food and Drug AdministrationNestle Health SciencesM&AMarkets