Germany’s Merck KGaA to Acquire US Biotech Company SpringWorks in $3.9 Billion Deal

German healthcare and materials firm Merck KGaA announced on Monday that it has agreed to buy U.S. biotech company SpringWorks Therapeutics for an equity value of $3.9 billion to enhance its cancer pharmaceuticals sector. The Darmstadt, Germany-based firm announced that the cash purchase price of $47 per share equates to an equity value of approximately $3.9 billion, translating to an enterprise value of $3.4 billion (3.0 billion euros) after accounting for SpringWorks' cash reserves, per a Reuters report.

Family-run Merck announced last week that the two firms are in advanced talks regarding an offer of about $47 for each SpringWorks share. It will be financed with existing cash and additional debt and is projected to positively impact Merck’s earnings per share, adjusted for extraordinary items, in 2027, according to a release from the German firm. It mentioned that it would continue to be capable of pursuing bigger transactions.

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SpringWorks, located in Stamford, Connecticut, went public in New York in 2019 and focuses on creating medications for cancer and uncommon tumour types. It offers two market products: Ogsiveo, which is expected to generate $172 million in sales for 2024 to address desmoid tumours, a severe condition impacting soft tissue and Gomekli, recently approved in February, intended for treating NF1-PN, marked by nerve sheath tumours.