Merck KGaA, Darmstadt, Germany, a leading science and technology company, and SpringWorks Therapeutics, a Stamford, Connecticut-based commercial-stage biopharmaceutical company focused on severe rare diseases and cancer, announced the companies have entered into a definitive agreement for Merck KGaA, Darmstadt, Germany, to acquire SpringWorks. The purchase price of $47 per share in cash represents an equity value of approximately $3.9 billion, or an enterprise value of $3.4 billion (€3.0 billion) based on SpringWorks’ cash balance as of December 31, 2024, and a premium of 26% to SpringWorks’ unaffected 20-day volume-weighted average price of $37.38 on February 7, 2025, the day prior to the first market speculation of a potential transaction between Merck KGaA, Darmstadt, Germany, and SpringWorks.
“The agreed acquisition of SpringWorks is a major step in our active portfolio strategy to position our company as a globally diversified, innovation and technology powerhouse. For our Healthcare sector, it sharpens the focus on rare tumors, accelerates growth, and strengthens our presence in the U.S.,” said Belén Garijo, Chair of the Executive Board and CEO of Merck KGaA, Darmstadt, Germany. “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.”
The planned transaction is fully aligned with the business development/M&A priorities of the Healthcare business of Merck KGaA, Darmstadt, Germany, as outlined during the company’s Capital Markets Day in October 2024: to continue to pursue external innovation via in-licensing of high-quality compounds at various stages of development and focused acquisitions that promise early value creation. It also fits with the strategic objective of strengthening the presence of the Healthcare business of Merck KGaA, Darmstadt, Germany, in the United States, the world’s largest pharmaceutical market. Merck KGaA, Darmstadt, Germany, operates its Healthcare business as EMD Serono in the United States and Canada.
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Upon closing, the business combination will immediately contribute to the revenues of Merck KGaA, Darmstadt, Germany, and is expected to be accretive to the company’s earnings per share pre (EPS pre) in 2027. The acquisition will be funded with available cash and new debt. Beyond this planned transaction, Merck KGaA, Darmstadt, Germany, will retain the ability to pursue larger transactions and continue to evaluate opportunities across its three sectors, with Life Science a priority. Merck KGaA, Darmstadt, Germany is committed to preserving its strong investment grade credit rating.
SpringWorks’ rare tumor portfolio, including a marketed first-in-class, systemic standard-of-care therapy for adults with desmoid tumors and the first and only approved therapy for adults and children with neurofibromatosis type 1 (NF1) who have symptomatic plexiform neurofibromas (PN) not amenable to complete resection, will accelerate immediate and sustainable revenue growth for Merck KGaA, Darmstadt, Germany. SpringWorks’ portfolio complements the progress of Merck KGaA, Darmstadt, Germany, in rare tumors, with Merck KGaA, Darmstadt, Germany, recently exercising an option for worldwide commercialization rights for pimicotinib, an investigational therapy developed by Abbisko Therapeutics Co., Ltd. for patients with tenosynovial giant cell tumor (TGCT).
“We have the unique opportunity with SpringWorks to establish a leadership position in rare tumors and build a strong foundation for further investments in this area, where a large unmet medical need exists,” said Peter Guenter, member of the Executive Board and CEO of Healthcare at Merck KGaA, Darmstadt, Germany. “Together, our company and SpringWorks are the perfect combination to improve outcomes for patients with rare tumors and bring therapeutic innovations to more patients worldwide while building on and reinforcing the early success of SpringWorks in the United States. For us, the planned acquisition will create long term, sustainable growth for our Healthcare business. Along with my successor Danny Bar-Zohar, we look forward to completing this strategic transaction and making a meaningful difference for patients whose lives are so profoundly affected by these complex and challenging tumors.”
SOURCE: Businesswire