Momenta Pharmaceuticals Shares Rise 69% on $6.5 Billion Johnson & Johnson Takeover Bid

Source: Streetwise Reports   08/19/2020

Shares of Momenta Pharmaceuticals set a new 52-week high after the company reported it entered into a definitive agreement with Johnson & Johnson to be acquired for $52.50 per share in cash.

Momenta Pharmaceuticals Inc. (MNTA:NASDAQ), which concentrates its efforts on creating biologic therapeutics to treat rare immune-mediated diseases, today announced “that it has entered into a definitive agreement for Johnson & Johnson (J&J) to acquire Momenta for $52.50 per share in an all-cash transaction, implying a fully diluted equity value of $6.5 billion.” The firm advised that the agreement has already been unanimously approved by each respective company’s Board of Directors.

Momenta Pharmaceuticals’ President and CEO Craig Wheeler commented, “The agreement with J&J recognizes the value created by years of commitment and dedication to our mission by the many current and past Momenta employees. Programs such as nipocalimab have the potential to improve the lives of countless patients suffering from autoimmune and fetal maternal diseases…This acquisition provides strong value for our shareholders and ensures a level of investment in our exciting portfolio that will further enhance its potential for patients. I believe J&J is the right company to advance our portfolio of novel drug candidates for autoimmune and rare diseases. J&J’s leadership in immunology, extensive capabilities, and global reach, as well as its alignment with our vision of pioneering therapies for complex diseases is a strong fit for our company and our portfolio.”

The company indicated that the $52.50 per share cash purchase price equates to a total equity value of $6.5 billion and represents a 70% premium to Momenta’s closing share price on Tuesday, August 18, 2020. The firm noted that the transaction is subject to various closing conditions outlined in the tender offer and merger agreement and is expected to close in H2/20.

The firm stated that the tender offer also remains subject to other customary closing conditions including majority shareholder and regulatory approvals. Until such time, Momenta Pharmaceuticals will continue operating as a separate independent company.

The company explained that according to the terms of the agreement, Johnson & Johnson’s wholly owned newly created subsidiary company, Vigor Sub Inc., has agreed to commence a tender offer to acquire all outstanding shares of Momenta common stock for $52.50 per share in cash. For its part, Momenta advised that it will file a recommendation statement to its stockholders that they tender their shares to Vigor, the merger subsidiary. Momenta’s shareholder letter will also state specifically that its Board of Directors’ unanimously recommends that stockholders tender all of their shares to Vigor Sub Inc.

Momenta Pharmaceuticals is a biotechnology company based in Cambridge, Mass. The firm is focused on discovering and developing new biologic therapeutics to treat rare immune-mediated diseases. The company is also actively advancing its portfolio of late stage biosimilars.

Momenta Pharmaceuticals started the day with a market capitalization of around $3.7 billion with approximately 118.8 million shares outstanding and a short interest of about 5.4%. MNTA shares opened 69% higher today at $52.10 (+$21.29, +69.10%) over yesterday’s $30.81 closing price and reached a new 52-week high price this morning of $52.21. The stock has traded today between $51.93 and $52.21 per share and is currently trading at $52.14 (+$21.33, +69.23%).

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