Five Prime Therapeutics (NASDAQ:FPRX) stock is soaring higher on Thursday following news that Amgen (NASDAQ:AMGN) is acquiring the company.
According to a news release, Amgen will be acquiring Five Prime Therapeutics for a total equity value of $1.9 billion. This will have it paying $38 per share in cash for FPRX stock. That’s a roughly 78.7% premium over the stock’s closing price on Wednesday.
Amgen notes that the deal will have it acquiring shares of FPRX stock in a tender offer. After this is complete, a subsidiary of AMGN will merge with Five Prime Therapeutics and convert shares to rights that convert to the purchase price in the tender offer.
Tom Civik, president and CEO of FPRX, said this about the news boosting the company’s stock today.
“We see tremendous complementarity between the two companies. Amgen has global reach, world-class resources, and they share our deep passion for science and commitment to patients. I have full confidence that Amgen is the right company to work with us to bring our innovative cancer treatments to patients and to achieve our mission to rewrite cancer.”
Five Prime Therapeutics and Amgen note the deal already has support from both companies’ Boards of Directors. It now just needs to complete customary closing conditions and get approval from shareholders and regulators. The two are expecting the deal to close by the end of Q2 2021.
FPRX stock was up 77.9% and AMGN stock was up 1.5% as of Thursday morning.
On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article.