AstraZeneca Shares Collapse on Alexion $39B Pharmaceuticals Deal

AstraZeneca saw its shares falling on Monday after the pharmaceutical giant announced its $39 billion plan to acquire rare-diseases biotech Alexion Pharmaceuticals.

Shares closed down 7.81% on Monday as Wall Street digested the news.

As part of the deal, Alexion shareholders will receive $60 in cash and 2.1243 AstraZeneca American Depositary Shares (ADSs) (each ADS representing one-half of one (1/2) ordinary share of AstraZeneca, as evidenced by American Depositary Receipts (ADRs)) for each Alexion share.

Based on AstraZeneca’s reference average ADR price of $54.14, this implies total consideration to Alexion shareholders of $39bn or $175 per share.

The boards of directors of both companies have unanimously approved the acquisition.
The deal is still subject to receipt of regulatory clearances and approval by shareholders of both companies and is expected to close in Q3 2021. Upon completion,

Alexion shareholders will own c.15% of the combined company.

Pascal Soriot, Chief Executive Officer, AstraZeneca, stated, “Alexion has established itself as a leader in complement biology, bringing life-changing benefits to patients with rare diseases. This acquisition allows us to enhance our presence in immunology. We look forward to welcoming our new colleagues at Alexion so that we can together build on our combined expertise in immunology and precision medicines to drive innovation that delivers life-changing medicines for more patients.”

Ludwig Hantson, Ph.D., Chief Executive Officer, Alexion, remarked, “For nearly 30 years Alexion has worked to develop and deliver transformative medicines to patients around the world with rare and devastating diseases. I am incredibly proud of what our organisation has accomplished and am grateful to our employees for their contributions. This transaction marks the start of an exciting new chapter for Alexion. We bring to AstraZeneca a strong portfolio, innovative rare disease pipeline, a talented global workforce and strong manufacturing capabilities in biologics. We remain committed to continuing to serve the patients who rely on our medicines and firmly believe the combined organisation will be well positioned to accelerate innovation and deliver enhanced value for our shareholders, patients and the rare disease communities.”

According to analysts, the deal helps Astrazeneca expand more into the rare-disease drug market.

Piper Sandler analyst Christopher Raymond called it “a deal so obvious, no one thought it would happen.”

“Given that the stock has been frustratingly rangebound despite strong commercial and pipeline execution, (we) thought it was just a matter of time before strategics began to take notice,” he said in a report to clients. “That appears to have been the case with this weekend’s news.”

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.