US-based pharmaceutical company Bristol Myers Squibb (BMS) has signed a merger agreement to acquire commercial-stage targeted oncology company Mirati Therapeutics for $4.8bn.
Under the terms of the deal, BMS will purchase all the outstanding shares of Mirati common stock at a price of $58 per share in cash, for a total equity value of $4.8bn.
The purchase price represents a 52% premium to the 30-day VWAP and values Mirati’s enterprise value at around $3.7bn, which provides around $1.1bn in cash on hand.
Mirati shareholders will also receive one non-tradeable CVR, which can be used to receive a one-time potential payment of $12 in cash, for a total of around $1bn, subject to conditions.
The Boards of Directors of both companies unanimously approved the transaction, which will be treated as a business combination.
The deal is expected to be closed by the first half of 2024, subject to certain customary closing conditions, including Mirati’s stockholders’ approval and regulatory approvals.
BMS intends to finance the acquisition through a combination of cash and debt.
Bristol Myers Squibb chief executive officer and board chair Giovanni Caforio said: “With a strong strategic fit, great science and clear value creation opportunities for our shareholders, the Mirati transaction is aligned with our business development goals.
“Importantly, by leveraging our skills and capabilities, including our global commercial infrastructure, we will ensure patients globally can benefit from Mirati’s portfolio of innovative medicines.”
Bristol Myers Squibb executive vice president and chief operating officer and chief executive officer-elect Chris Boerner said: “With multiple targeted oncology assets including KRAZATI, Mirati is another important step forward in our efforts to grow our diversified oncology portfolio and further strengthen Bristol Myers Squibb’s pipeline for the latter half of the decade and beyond.”
Mirati is a targeted oncology company focused on cancer therapies, with a portfolio comprising KRAZATI (adagrasib), MRTX1719, and a KRAS and KRAS enabling program.
Through the acquisition, BMS will add Mirati’s lung cancer drug Krazati to its commercial portfolio, along with several promising clinical assets that complement its oncology pipeline.
BMS believes that Mirati’s assets can change the standard of care in multiple cancers, both as standalone therapies and in combination with its existing pipeline.
Evercore and Morgan Stanley & Co. served as financial advisors, and Kirkland & Ellis as legal counsel to BMS, on the transaction.
Centerview Partners served as a financial advisor, and Skadden, Arps, Slate, Meagher & Flom as legal counsel to Mirati.
Mirati Therapeutics founder, president and chief executive officer Charles Baum said: “This transaction is a testament to the potential of our platform and to our team’s hard work and dedication to changing lives.
“Bristol Myers Squibb’s global scale, resources and commitment to innovation will enable Mirati’s therapeutics to benefit more patients, faster, and deliver on our vision of unlocking the science behind the promise of a life beyond cancer.
“We believe that this transaction is the best way to benefit patients and maximise value for shareholders.”
