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The FTC Challenges Amgen’s Acquisition Of Horizon Therapeutics – Merger Arbitrage Mondays

  • May 22, 2023

The FTC is suing to block another multi-billion dollar M&A deal. Shares of Horizon Therapeutics (HZNP) plunged 14% on May 16, 2023, on reports that the FTC was filing a suit to block the company’s sale to Amgen (AMGN).

Horizon Therapeutics entered into a definitive agreement to be acquired by Amgen for $28.3 billion on December 12, 2022. We added Horizon as a potential deal in the works on November 29, 2022, when the company reported that it was engaged in preliminary discussions with Amgen, Johnson & Johnson’s (JNJ) unit Janssen and Sanofi (SNY).  Janssen and Sanofi opted out of the bidding, leaving Amgen as the sole suitor.

The transaction was initially expected to be completed in the first half of 2023. The first sign of trouble for the deal was in January 2023, when Sen. Elizabeth Warren wrote to the U.S. Federal Trade Commission to express concern about Amgen’s plan to buy Horizon Therapeutics, and Indivior’s (LON: INDV) plan to buy Opiant (OPNT). Indivor successfully  completed the acquisition of Opiant in March. Horizon Therapeutics and Amgen were not so fortunate and received a request for additional information from the FTC in January.

The companies received clearances or confirmation of non-applicability related to foreign direct investment in Denmark, Italy, Germany and France and clearances related to antitrust in Germany and Austria. Horizon is headquartered in Dublin and according to the merger agreement, the acquisition will be implemented by way of an Irish High Court-sanctioned scheme of arrangement. On April 17, 2023, an Irish High Court set a court hearing for May 22, 2023, to consider the application of Horizon’s sale to Amgen.

The biggest roadblock came last week, when reports of the deal being challenged by federal regulators began to surface. On May 16, The FTC, in a press release stated that it is seeking to block Amgen from acquiring Horizon Therapeutics, as ‘the deal would allow Amgen to leverage its portfolio of blockbuster drugs to entrench the monopoly positions of Horizon medications used to treat two serious conditions, thyroid eye disease (Tepezza) and chronic refractory gout (Krystexxa).’

In its defense, Amgen stated that the FTC’s remark that it may “bundle” these medicines in the future is completely speculative and does not reflect the dynamics of real-world competition behind providing medicines to patients with rare-diseases.

On Wednesday, May 17, a temporary restraining order was issued by a U.S. district court judge, after the two companies and the FTC reached an agreement that both sides said in a joint filing would permit a full briefing and “less-compressed consideration” by the court of the FTC request. Under the order, Amgen and Horizon will not close their transaction until the earlier of September 15, or the second business day after the court rules on the FTC’s request for a preliminary injunction.

HZNP Spread History

The current spread on the deal is 15.63% and 27.43% annualized, if the deal is completed by mid-December.

Leonard Schleifer, CEO of Regeneron (REGN) said on Friday, May 19 that he agrees with the FTC’s lawsuit objecting to Amgen’s acquisition of Horizon Therapeutics. “I’m glad the FTC is looking at this,” Schleifer told the Financial Times US pharma and biotech summit in New York. “I think what goes on at the payer level is in some respects the worst thing for our industry and we’ve got to shine a brighter light on it.

Regeneron’s interference in the Amgen – Horizon deal is similar to Sony interfering in Microsoft’s acquisition of Activision Blizzard, in spite of Microsoft offering to provide “Call of Duty” games to rivals including Sony and others for a period of 10 years.

Back in January 2020, Illumina (ILMN) and Pacific Biosciences of California (PACB) mutually terminated their merger agreement, after facing regulatory issues from U.K.’s Competition and Markets Authority (CMA) and the FTC. Oxford Nanopore Technologies (ONTTF), a spin-out from the University of Oxford stood out as a competitor to the deal.

The Amgen-Horizon deal is another example of the current challenging environment for mergers. The FTC has also challenged Microsoft’s (MSFT) acquisition of Activision Blizzard (ATVI). The deal was approved by China and the European Union’s antitrust watchdog last week, but still faces opposition from the FTC in the U.S. and the CMA in the United Kingdom.

Merger Arbitrage activity decreased last week with two new deals announced, and one deal closing.

You can find all the active deals listed below in our Merger Arbitrage Tool (MAT) which automatically updates itself during market hours.

Merger Arbitrage

Deal Statistics:

Total Number of Deals Closed in 202367
Total Number of Deals Not Completed in 20234
Total Number of Pending Deals
Cash Deals40
Stock Deals18
Stock & Cash Deals6
Special Conditions6
Total Number of Pending Deals70
Aggregate Deal Consideration$682.28 billion

New Merger Arbitrage Deals:

  1. The acquisition of eMagin Corporation (EMAN) by Samsung Display Co., Ltd. for a closing value of $218 million or $2.08 per share in cash.
  2. The acquisition of Urstadt Biddle Properties (UBP) by Regency Centers Corporation (REG) for $1.4 billion in an all stock deal. Under the terms of the Agreement, Urstadt Biddle’s Class A Common (UBA) and Common (UBP) stockholders will receive 0.347 of a newly-issued REG share for each UBA or UBP share they own.

Deal Updates:

  1. On May 12, 2023, Seagen (SGEN) and Pfizer (PFEfiled with the FTC and DOJ a Notification and Report Form relating to the merger agreement and the merger as required under the HSR Act.
  2. On May 16, 2023, Darden Restaurants (DRIlaunched its tender offer to acquire Ruth’s Hospitality Group (RUTH). The offer will expire on June 13, 2023.
  3. On May 18, 2023, Kimball International (KBAL) announced that it expects to close the deal with HNI Corporation (HNI) on June 1, 2023.
  4. On May 19, 2023, VMware (VMW) and Broadcom (AVGOextended the Outside Date of their Merger Agreement to August 26, 2023. If the transaction is not completed before August 26, 2023, either Broadcom or VMware may further extend the Outside Date to November 26, 2023.
  5. On May 19, 2023, Sisecam Resources (SIRE) announced that it notified the New York Stock Exchange that it anticipates completing the merger with Sisecam Chemicals Wyoming LLC will close on or about May 26, 2023.


  1. May 15, 2023: According to The Wall Street Journal, the European Union’s antitrust watchdog approved Microsoft’s (MSFT) planned acquisition of Activision Blizzard (ATVI), giving the two companies a win after the deal hit a regulatory roadblock in the U.K.
  2. On May 15, 2023, Baytex Energy (BTE) announced that its shareholders approved the previously announced merger with Ranger Oil Corporation (ROCC). The merger is expected to close on or within three business days of the Ranger shareholder meeting.
  3. On May 15, 2023, BELLUS Health (BLU) and GSK plc (GSK) received clearance from the Canadian Commissioner of Competition.
  4. On May 17, 2023, INDUS Realty Trust (INDT) announced that its stockholders voted to approve the previously announced proposed merger with Centerbridge Partners and GIC.
  5. On May 19, 2023, Microsoft (MSFT) said that China has unconditionally approved its plan to buy Activision Blizzard (ATVI), even as the deal still faces antitrust opposition in the U.S. and United Kingdom.


  1. On May 15, 2023, the New Mexico Supreme Court issued a decision to deny a joint motion filed by PNM Resources (PNM), AVANGRID (AGR), and the New Mexico Public Regulation Commission (NMPRC) to dismiss the appeal of its merger denial and remand the case back to the NMPRC. The appeal of the NMPRC’s merger denial remains in the jurisdiction of the New Mexico Supreme Court, and the court has scheduled oral arguments for September 12, 2023.
  2. May 16, 2023: The Federal Trade Commission released a statement, stating that it is seeking to block Amgen (AMGN) from acquiring Horizon Therapeutics (HZNP), saying the deal would allow Amgen to leverage its portfolio of blockbuster drugs to entrench the monopoly positions of Horizon medications used to treat two serious conditions, thyroid eye disease, and chronic refractory gout.
  3. May 16, 2023: According to The Wall Street Journal, UBS Group AG (UBS) said that it has set aside $4 billion to cover potential legal and regulatory costs from its acquisition of Credit Suisse (CS) and that it is expecting to record other asset write-downs.
  4. On May 16, 2023, Standard General provided additional information to the Federal Communications Commission to addresses potential concerns around the two issues raised in its Hearing Designation Order, related to its acquisition of Tegna (TGNA).
  5. On May 18, 2023, Amgen (AMGN) agreed not to close its purchase of Horizon Therapeutics (HZNP) before September 15, 2023, or the second business day after the court rules on the FTC’s request to block the deal.

Shareholders Meeting Schedule:

  1. Diversey Holdings (DSEY) – June 8, 2023
  2. BELLUS Health (BLU) – June 16, 2023
  3. Prometheus (RXDX) – June 15, 2023
  4. Ranger Oil Corporation (ROCC) – June 16, 2023

Closed Deals:

  1. The acquisition of TravelCenters of America (TA) by BP p.l.c. (BP) on May 15, 2023. It took 88 days for this deal to be completed.

Weekly Spread Changes:

The table below shows weekly spread changes between May 12, 2023, and May 19, 2023.

Company Quote
Last Week
Spread Change
INFI0.1649MEI Pharma, Inc. (MEIP)7.61139.98%104.72%35.26%All Stock
HZNP100.75Amgen Inc. (AMGN)223.4215.63%4.95%10.68%All Cash
IRBT32.07Amazon (AMZN)116.2590.21%80.74%9.47%All Cash
SIMO53.51MaxLinear, Inc. (MXL)28.5695.52%88.95%6.57%Cash Plus Stock
PNM45.54Avangrid, Inc. (AGR)38.5510.45%5.32%5.13%All Cash
SAL25.02NBT Bancorp Inc. (NBTB)34.292.10%5.02%-2.92%All Stock
HEXO1.42Tilray Brands, Inc. (TLRY)2.41-26.14%-22.88%-3.26%All Stock
TSEM41.48Intel Corporation (INTC)29.9327.77%31.16%-3.39%All Cash
BKI55.62Intercontinental Exchange, Inc. (ICE)108.0335.50%40.45%-4.95%Cash Plus Stock
DHC1Office Properties Income Trust (OPI)6.59-3.13%4.15%-7.28%All Stock

Top 10 Merger Arbitrage Deals With The Largest Spreads:

Please do your own due diligence on deals with large spreads. Some of these large spreads might be related to regulatory issues or because of the way the deal is structured. We classify some of these deals as “special situation” deals in our merger arbitrage tool and provide additional details to help with the analysis. There may be unique situations related to special dividends, spinoffs, proration, etc. that need to be accounted for when looking at these spreads.

INFI02/23/2023MEI Pharma, Inc. (MEIP)$0.40$0.164906/30/2023139.98%1277.28%
SAVE07/28/2022JetBlue Airways Corporation (JBLU)$31.00$15.5906/30/202498.85%88.86%
SIMO05/05/2022MaxLinear, Inc. (MXL)$104.62$53.5106/30/202395.52%871.59%
IRBT08/05/2022Amazon (AMZN)$61.00$32.0708/05/202390.21%433.24%
TGNA02/22/2022Standard General L.P. (N/A)$24.00$16.1805/22/202348.33%17640.91%
BKI05/04/2022Intercontinental Exchange, Inc. (ICE)$75.37$55.6208/04/202335.50%172.79%
ACI10/14/2022The Kroger Co. (KR)$27.25$20.2603/31/202434.50%39.98%
TSEM02/15/2022Intel Corporation (INTC)$53.00$41.4805/15/202327.77%-1689.49%
ATVI01/18/2022Microsoft Corporation (MSFT)$95.00$78.5906/30/202320.88%190.53%
SGEN03/13/2023Pfizer Inc. (PFE)$229.00$193.301/31/202418.47%26.44%

Deals In The Works

Four new potential Merger Arbitrage deals were added to the ‘Deals In The Works‘ section last week.

  1. On May 16, 2023, National Western Life Group, Inc. (NWLI) announced that the company is exploring strategic alternatives in order to maximize value for the company’s stockholders.
  2. May 16, 2023: According to Bloomberg, several major drugmakers keen to expand in immunology have been studying the $23 billion company Argenx (ARGX) and have it at the top of their wish lists. Argenx has also been working with JPMorgan Chase & Co. to help identify options in the event of any takeover bid.
  3. May 16, 2023: According to a 13D filing, Legion Partners pushes CCO to evaluate a sale of the entire company.
  4. May 17, 2023: According to WSJ, private equity firms Francisco Partners and TPG (TPG are working together on a $5 billion-plus bid to acquire software company New Relic (NEWR).


  1. Bloomberg reported Hedge fund manager Dan Loeb said he’s no longer exploring an acquisition of specialist insurance underwriter SiriusPoint (SPNT).
  2. According to Reuters, Kioxia Holdings Corp and Western Digital Corp (WDC) are speeding up merger talks and nailing down a deal structure.
  3. According to Reuters, Maravai LifeSciences (MRVI) rejected the non-binding offer from buyout firm Thomas H. Lee Partners.

SPAC Arbitrage

Potential SPAC IPO

  1. On May 3, 2023, Prospect Energy Holdings Corp. (AMGS) filed for a $300 million IPO.
  2. On May 15, 2023, FPA Energy Acquisition Corp. (FPAQ) filed for a $100 million IPO.
  3. On May 19, 2023, Bowen Acquisition Corp (BOWN) filed for a $60 million IPO.

SPAC Business Combination

  1. On May 15, 2023, Global Hydrogen Energy and Dune Acquisition Corporation (DUNEentered into a definitive agreement for a business combination, which would result in Global Hydrogen becoming a publicly listed company.
  2. On May 17, 2023, enGene, Inc. and Forbion European Acquisition Corp. (FRBNentered into a definitive business combination agreement.
  3. On May 19, 2023, Suntuity Renewables and Beard Energy Transition Acquisition Corp. (BRDentered into a definitive agreement that would result in the combined company becoming publicly traded.


  1. On May 17, 2023, SunCar Technology Group Inc. (SDAannounced the completion of the previously announced business combination with Goldenbridge Acquisition Limited (GBRG)


  1. On May 16, 2023, Fintech Ecosystem (FEXDterminated its business combination with financial services provider Rana Financial, Inc. and Afinoz.
  2. Better World Acquisition (BWAC) announced that it has terminated its business combination with Heritage Distilling.

List of all pending Merger Arbitrage deals:

Disclaimer: I have long positions in Activision Blizzard (ATVI), Spirit Airlines (SAVE),  Tower Semiconductor (TSEM) and TEGNA (TGNA). Please do your own due diligence before buying or selling any securities mentioned in this article. We do not warrant the completeness or accuracy of the content or data provided in this article.