Arena Pharmaceuticals (NASDAQ:ARNA) stock is flying higher on Monday thanks to a huge deal with Pfizer (NYSE:PFE).
Pfizer signed a definitive agreement that will have it acquiring Arena Pharmaceuticals for $6.7 billion. That has it valuing shares of ARNA stock at $100 each, which is roughly double the closing price of the stock on Friday. PFE is using cash on hand to fund the transaction.
Pfizer notes that adding Arena Pharmaceuticals to its business brings with it many advantages. That includes the company’s various therapeutic candidates that are still in developmental stages.
Mike Gladstone, global president and general manager of Inflammation and Immunology at Pfizer, said the following about the deal.
“The proposed acquisition of Arena complements our capabilities and expertise in Inflammation and Immunology, a Pfizer innovation engine developing potential therapies for patients with debilitating immuno-inflammatory diseases with a need for more effective treatment options.Utilizing Pfizer’s leading research and global development capabilities, we plan to accelerate the clinical development of etrasimod for patients with immuno-inflammatory diseases.”
Pfizer notes that it still needs to complete customary closing conditions before the deal is done. That includes approval from regulators and shareholders of ARNA stock. The company doesn’t say when it expects the transaction to come to a close.
ARNA is seeing heavy trading today on the Pfizer news. This has some 7 million shares on the move. That’s quite the jump from the company’s daily average trading volume of about 498,000 shares.
ARNA stock is up 83.3% and PFE stock is up 5.1% as of Monday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.