German science and technology firm Merck has agreed to acquire US-based biotech firm SpringWorks Therapeutics for an equity value of around $3.9bn.
The acquisition aligns with Merck’s strategic goal of enhancing its presence in the US.
Under the terms of the agreement, Merck will purchase SpringWorks’ shares at $47 each, translating to an enterprise value of up to $3.4bn.
The German drugmaker will finance the acquisition through available cash and new debt.
Upon completion, the merger is expected to immediately boost Merck’s revenues and become accretive to its earnings per share pre (EPS pre) by 2027.
Merck CEO and executive board chair Belén Garijo said: “The agreed acquisition of SpringWorks is a major step in our active portfolio strategy to position Merck as a globally diversified, innovation and technology powerhouse.
“For our Healthcare sector, it sharpens the focus on rare tumours, accelerates growth, and strengthens our presence in the US.
“Beyond this planned transaction, we will continue to explore M&A opportunities across our three complementary business sectors, always with a firm focus on strategic fit, financial robustness, and long-term value creation.”
SpringWorks, based in Stamford, Connecticut, is a biotechnology company specialising in developing treatments for severe rare diseases and cancer.
Its rare tumour portfolio includes Ogsiveo (nirogacestat), a systemic standard-of-care therapy for desmoid tumours, and Gomekli (mirdametinib), the only FDA-approved therapy for neurofibromatosis type 1 (NF1) not amenable to complete resection.
The acquisition will enable SpringWorks to expand its market reach beyond the US, leveraging Merck’s global resources.
Merck’s recent progress in rare tumours includes executing an option for global marketing rights to pimicotinib, an investigational therapy for tenosynovial giant cell tumour (TGCT).
The proposed transaction has been unanimously approved by the Boards of Directors of both Merck and SpringWorks.
It is anticipated to be completed in the second half of this year, subject to customary closing conditions, shareholder approval, and regulatory clearances.
J.P. Morgan served as exclusive financial advisor, and Sullivan & Cromwell as legal counsel to Merck, on the transaction.
Centerview Partners and Goldman Sachs & Co. served as advisors, while Goodwin Procter served as legal counsel to SpringWorks.
SpringWorks Therapeutics CEO Saqib Islam said: “From the outset, our focus at SpringWorks has been to create transformative solutions for patients suffering from serious diseases.
“We have successfully launched two best-in-class medicines in the United States, and with the aspiration to deliver our therapies worldwide, our journey is at a pivotal juncture.
“It became clear during our discussions with the Merck team that we share many core values, including a commitment to help more patients with rare tumours live longer, better lives.
“We believe that by joining forces with Merck, we are not only creating significant, immediate value for our stakeholders, but we will also be able to leverage their resources and expertise to build a brighter future for the patient communities.”
