Merck & Co to Buy Cubist for $8.4 Billion for Its Antibiotics
Merck will begin a $102-a-share tender offer for Cubist, the companies said in a statement today. The price is 37 percent above Cubist’s closing level on Dec. 5. Including net debt, the deal is valued at about $9.5 billion.
Chief Executive Officer Ken Frazier said the deal will add to Merck’s line of drugs used in hospitals, one of four areas of strategic focus the drugmaker announced last year. “We will continue to look at our portfolio to bolster those areas where we can have leadership and market growth, and to divest those things that have better opportunities outside our business,” Frazier said on a conference call discussing the deal.
Cubist has said it plans to introduce four new drugs by 2020 to combat bacterial infections that are resistant to other treatments because of overuse. The rising threat of drug-resistant bugs has spurred public health authorities to urge companies to invest in new antibiotics, a field drugmakers had largely abandoned to focus on more profitable therapeutic areas such as cancer or hepatitis C.
For more visit: www.bloomberg.com
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