AstraZeneca acquires Alexion in $39bn mega-merger

BY Fraser Tennant

In one of the year’s largest drug mergers, multinational pharmaceutical and biopharmaceutical company AstraZeneca is to acquire US biopharmaceutical company Alexion Pharmaceuticals, Inc. in a transaction valued at $39bn.

Under the terms of the definitive agreement, Alexion shareholders will receive $60 in cash and 2.1243 AstraZeneca American Depositary Shares (ADSs). The deal is expected to achieve double-digit revenue growth through 2025.

"Alexion has established itself as a leader in complement biology, bringing life-changing benefits to patients with rare diseases,” said Pascal Soriot, chief executive of AstraZeneca. “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."

The combined company will have an enhanced global footprint and broad coverage across primary, speciality and highly specialised care.

“For nearly 30 years Alexion has worked to develop and deliver transformative medicines to patients around the world with rare and devastating diseases,” said Ludwig Hantson, chief executive of Alexion. “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.”

Furthermore, the capabilities of both organisations will create a company with great strengths across a range of technology platforms, with the ability to bring innovative medicines to millions of people worldwide.

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

Mr Hantson concluded: “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.”

News: AstraZeneca to acquire Alexion in $39 bln deal

Salesforce to acquire Slack for $27.7bn

BY Richard Summerfield

Salesforce has agreed to acquire Slack Technologies in a deal worth $27.7bn. Under the terms of the agreement, Slack shareholders will receive $26.79 in cash and 0.0776 shares of Salesforce common stock for each Slack share held. That is $45.50 per share, based on Salesforce’s closing price on Tuesday - a premium of 54 percent since news of negotiations between the companies emerged last week.

The board of directors of both companies have approved the deal and the Slack board recommends that Slack stockholders approve the transaction and adopt the merger agreement. The transaction is expected to close in the second quarter of Salesforce’s fiscal year 2022, subject to approval by Slack stockholders, the receipt of required regulatory approvals and other customary closing conditions.

“This is a match made in heaven,” said Marc Benioff, co-founder and chief executive of Salesforce. “Together, Salesforce and Slack will shape the future of enterprise software and transform the way everyone works in the all-digital, work-from-anywhere world.”

“As software plays a more and more critical role in the performance of every organization, we share a vision of reduced complexity, increased power and flexibility, and ultimately a greater degree of alignment and organizational agility,” said Stewart Butterfield, chief executive of Slack. “Personally, I believe this is the most strategic combination in the history of software, and I can’t wait to get going.”

Slack has seen a near-doubling of its market value in 2020 as the COVID-19 pandemic has seen offices close and remote working come to the fore. However, at the start of the year, Slack had lost around 40 percent of its value since it went public. Equally, according to its most recent earnings report, the company lost 16 percent of its value. Slack also recorded net losses of $147.6m during two quarters of 2020.

The deal is expected to help Salesforce tackle the market dominance of Microsoft, which has seen a significant surge in the number of people utilising its business applications during the coronavirus crisis.

News: Salesforce acquires Slack for over $27 billion, marking cloud software vendor’s largest deal ever

RSA sold in $9.6bn deal

BY Richard Summerfield

British insurance firm RSA has agreed to be sold to Canada’s Intact Financial and Denmark’s Tryg in a $9.55bn cash deal.

The deal has won the unanimous approval of RSA’s directors who recommended the company’s shareholders vote in favour of the offer. The deal is expected to complete in the second quarter of 2021.

Under the terms of the deal, Tryg will pay around £4.2bn while Intact will contribute the remaining £3bn, with the overall offer representing a 51 percent premium to RSA’s 4 November closing share price of 460 pence. RSA shareholders will also receive a preannounced interim dividend of 8p per share, worth about £82m.

The proposed takeover would see RSA’s existing business broken up. Intact would gain RSA’s Canada, UK and international operations while Tryg would take the Sweden and Norway businesses. The consortium would co-own RSA’s Danish unit, though it will be managed by Intact while it explores strategic options for the business, including a sale or stock market flotation.

“The board of RSA is pleased to be recommending Intact and Tryg’s cash offer for the company, which delivers attractive, certain value for shareholders,” said Martin Scicluna, chairman of RSA. “RSA has provided peace of mind to individuals and protected businesses from risk for more than 300 years. However, I am confident that the values of our business, and not least our dedication to serving customers well, will be sustained as part of Intact and Tryg.”

“This acquisition is highly strategic for Intact,” said Charles Brindamour, chief executive of Intact. “It expands our leadership position in Canada, builds on our strong track record in specialty lines, and puts us in a solid position to strengthen RSA’s UK and Ireland operations. We have strong capabilities in data, risk-selection and claims management, which we plan to leverage across the business. I look forward to welcoming RSA’s employees into our company and leveraging their deep expertise across the business. Together, we are stronger and more resilient.”

News: British insurer RSA agrees $9.6 billion takeover by overseas rivals

Traton and Navistar agree $3.7bn deal

BY Richard Summerfield

Traton SE, a subsidiary of Volkswagen Group, has agreed to acquire the remaining stake in Navistar International Corp it does not already own, for $44.50 per share. The deal values the company at around $3.7bn.

The deal, which is expected to close in mid-2021, has been approved by Traton’s executive board and supervisory board. The deal has also been approved by Volkswagen’s board.

Traton, which was established in 2018 after the Volkswagen Group separated its truck and passenger car operations, already owned a 16.8 percent stake in Navistar. The Volkswagen group will provide Traton with a loan of $3.9bn, repayable over 12-18 months, to fund the deal.

“Today’s announcement accelerates our Global Champion Strategy by expanding our reach across key truck markets worldwide, including scale and capabilities to deliver cutting-edge products, technologies and services to our customers,” said Matthias Gründler, chief executive of Traton. “Together, we will have an enhanced ability to meet the demands of new regulations and rapidly developing technologies in connectivity, propulsion and autonomous driving for customers around the world.”

He added: “Navistar has been a valuable partner, and we are confident this combination will deliver compelling strategic and financial benefits, create enhanced opportunities for both Navistar and TRATON, and best position us to drive sustained value in the evolving global commercial vehicle industry.”

“This transaction builds upon our highly collaborative and successful strategic alliance and further enhances the growth trajectory of the combined company, while delivering immediate and substantial value to our shareholders,” said Persio Lisboa, president and chief executive of Navistar. “We look forward to continuing to work with the TRATON team to create opportunities for our employees and provide an outstanding experience for our customers and dealers through best-in-class products, services and technologies.”

The agreement brings to an end a period of uncertainty regarding the future of Navistar. In September, Traton offered $43 per share, but Navistar International’s board of directors rejected the bid on grounds that it significantly undervalued the company. Navistar has since accepted Traton’s sweetened offer, and the company’s largest shareholders, Carl Icahn and MHR Fund Management, have also pledged their support for the deal.

News: Volkswagen truck unit Traton finalises $3.7 billion Navistar acquisition deal

Going private: KAZ Minerals acquired by Nova Resources in £3bn deal

BY Fraser Tennant

In a £3bn deal designed to take it private once again, copper miner KAZ Minerals has been acquired by Nova Resources, a company owned by a consortium comprised of KAZ chairman Oleg Novachuk and Kazakh billionaire Vladimir Kim.

An all-cash-deal, under the terms of the acquisition, Nova Resources will pay the shareholders of London-listed KAZ Minerals 640 pence per share. It is It is intended that the acquisition will be implemented by way of a court-sanctioned scheme of arrangement.

A high-growth copper company focused on large scale, low cost open pit mining in the Commonwealth of Independent States (CIS) region, KAZ Minerals has a track record for the successful delivery of greenfield mining projects. The company employs around 15,000 people, principally in Kazakhstan.

"We are pleased to announce this recommended cash offer for KAZ Minerals,” said Oleg Novachuk, chairman of Nova Resources. “Mr Kim and I believe that KAZ Minerals has made notable progress as a public company since listing on the London Stock Exchange in 2005. However, driven by the current market uncertainty and the corporate circumstances of sequential development projects, we believe that KAZ Minerals' long term interests would be best served as a private company.”

Mr Novachuk is confident that the execution of a higher risk, capital intensive strategy remains the optimal long-term path for KAZ Minerals but recognises that the company’s risk appetite may be misaligned with the preference of many investors in the mining sector.

"Following extensive negotiations, the independent committee of KAZ Minerals intends to unanimously recommend the acquisition to its shareholders as representing an opportunity to realise their investment at a premium in cash in the near term,” said Michael Lynch-Bell, senior independent director and chair of the independent committee at KAZ Minerals. “We believe the offer provides a fair value for KAZ Minerals.”

The acquisition is expected  to be completed in the first half of 2021, subject to the approval of KAZ Minerals’ shareholders, receipt of the relevant antitrust clearances, regulatory approvals and the sanction of the scheme of arrangement by the court.

Mr Novachuk concluded: “In taking this important step, we wanted to ensure that KAZ Minerals’ shareholders were provided with the opportunity to crystallise the value of their investment at a premium valuation. We are confident that this acquisition will deliver an attractive return.”

News: KAZ bosses sign 3 bln pound deal to take miner private again