AveXis Inc (NASDAQ:AVXS) stock was flying high to day following news of a deal with Novartis AG (ADR) (NYSE:NVS).
The deal will have Novartis AG (ADR) acquiring AveXis Inc for $218 per share. This represents an 88% premium to the stock’s closing price on April 6, 2018. It is also a 72% premium over its 30-day volume-weighted average stock price.
Novartis AG (ADR) is using a new acquisition subsidiary to handle the deal with AveXis Inc. This subsidiary, Novartis AM Merger Corporation, will be making a cash offer for all outstanding shares of AVXS stock no later than April 17, 2018.
Novartis AG (ADR) notes that its offer of $218 per share for AVXS stock has a total value of $8.7 billion. It also has the unanimous approval of both companies’ Board of Directors. The two are expecting the deal to close in mid-2018.
The deal will have Novartis AG (ADR) combining AveXis Inc operations and employees with its own once its reaches completion. It says that it is still planning to bring AVXS-101 to patients. NVS believes that the drug can strengthen its position as a leader of gene therapy and neuroscience.
“With worldwide reach and extensive resources, Novartis should expedite our shared vision of bringing gene therapy to these patient communities across the globe as quickly and safely as possible,”Sean Nolan, President and CEO of AveXis Inc, said in a statement.
Novartis AG (ADR) will first need the approval of regulators and to complete customary closing conditions. However, one this is done, it can complete its acquisition of AveXis Inc.
AVXS stock was up 80% and NVS stock was up 1% as of noon Monday.
As of this writing, William White did not hold a position in any of the aforementioned securities.
