Nestle has entered into a definitive agreement to buy allergy treatment maker Aimmune Therapeutics for about $2 billion. Nestle wants to expand its fast-growing health science business by adding a leader in peanut allergy treatment. The transaction will likely close in the fourth quarter. Nestle plans to finance the deal with cash on hand. Currently, Nestle has a stake of about 25.6 percent in Aimmune Therapeutics.
Big news for those who suffer from peanut allergies!@Nestle to buy Aimmune Therapeutics in $2.6bn deal. Aimmune's Palforzia is the first and only FDA-approved treatment to help reduce frequency & severity of allergic reaction to peanuts.— Julianna Tatelbaum (@CNBCJulianna) August 31, 2020
I speak to Nestle Health Science CEO 👇 pic.twitter.com/cV76lTqbpj
What is the Aimmune Therapeutics news
Nestle, known for Nescafe instant coffee and its KitKat chocolate bars, wants to acquire the remaining 74.4 percent stake in Aimmune Therapeutics. Under the terms of the deal, Nestle has agreed to pay $34.50 per share for the biotechnology company. Nestle offered a 174 percent premium to Aimmune’s last closing share price of $12.60. The transaction will likely be accretive to Nestle’s organic growth in 2021 and cash earnings by 2022 or 2023.
Nestle expects that approximately 240 million people globally suffer from food allergies. The most common type of food allergy is caused by peanuts. Nestle will have access to Aimmune Therapeutics's therapy to reduce peanut allergic reactions. In February, Aimmune’s peanut allergy treatment, Palforzia, won approval from the FDA. Wall Street estimates that its sales could exceed $1 billion in 2025.
According to a Reuters report, “(Palforzia) has 12 years of exclusivity, global rollout will follow and they have the technology platform for other food allergies in development.”
What's Nestle's stock price today?
Nestle stock is mainly listed on the SIX Swiss Exchange under stock code NESN. Early on Monday, Aug. 31, the stock was up about 0.9 percent after the deal was announced. On Aug. 28, Nestle stock closed 1.2 percent lower at 108.86 Swiss franc. The stock has fallen by 1.0 percent in the last five days and 1.8 percent in the last year. Nestle stock is trading 3.8 percent below its 52-week high of 113.20 Swiss franc and 30.6 percent above its 52-week low of 83.37 Swiss franc. Year-to-date, the stock had risen by 4.6 percent as of Aug. 28.
What's Aimmune Therapeutics's stock price now?
On Aug. 31, Aimmune Therapeutics stock was up about 169.5 percent at $33.96 in pre-market trading. The stock rose 5.1 percent on Aug. 28 and closed at $12.60 with a market capitalization of $824.7 million. The stock has risen by 1.0 percent in the last five days and has fallen by 38.2 percent in the last year. Aimmune Therapeutics stock is trading 65.9 percent below its 52-week high of $37.00 and 24.9 percent above its 52-week low of $10.09. Year-to-date, the stock had fallen by 62.4 percent as of Aug. 28.