Ra Pharmaceuticals (NASDAQ:RARX) is seeing its stock take off on Thursday following news of a deal with UCB (OTCMKTS:UCBJF).
A Ra Pharmaceuticals news release reveals that the company has agreed to be acquired by UCB. This will have UCB spending a total of $2.1 billion to acquire the company. That has it valuing RARX stock as $48 per share.
The offer of $48 per share for RARX stock is a pretty premium for shareholders. The stock’s closing price on Wednesday was $22.70. This has the offer from UCB at roughly 111.50% above the previous closing price. The offer is also higher than RARX stock has ever traded for in its three-year history.
UCB notes that the funding of the deal will come from a mixture of existing cash resources and new bank term loans. It also mentions that it doesn’t expect the deal to affect its guidance for 2019.
The deal between Ra Pharmaceuticals and UCB already has unanimous support from both companies’ Boards of Directors. However, it will also need approval from shareholders and regulators before it can close. So long as everything goes right, the deal will reach completion in the first quarter of 2020.
Jean-Christophe Tellier, CEO of UCB, has this to say about the Ra Pharmaceuticals news.
“Ra Pharma is an excellent strategic fit addressing multiple areas of UCB’s patient value growth strategy. Upon closing, the acquisition will add to our strong internal growth opportunities – six potential product launches in the next five years, strengthening our neurology and immunology franchises with late and early-state pipeline projects.”
RARX stock was up 100% as of Thursday afternoon.
As of this writing, William White did not hold a position in any of the aforementioned securities.
