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Lilly Boosts Immunology Pipeline with Morphic Acquisition – Merger Arbitrage Mondays

  • July 15, 2024

Morphic Holding Inc. (MORF): $55.78

Market Cap: $2.79 B

Deal Size: $3.2 B

For this week’s Merger Arbitrage post, we delve into Eli Lilly’s (LLY) acquisition of Morphic Holding, Inc. (MORF) for $3.2 billion. This transaction, part of a wave of recent pharma deals, involves Lilly launching a tender offer to buy all outstanding shares of Morphic at $57 per share in cash. The acquisition grants Lilly access to Morphic’s experimental drug for inflammatory bowel diseases, thereby enhancing its immunology pipeline with oral integrin therapies.

The deal trades at a tiny spread of 2.14% but the annualized spread of 9.89% is not bad considering the deal is expected to close in the third quarter of 2024.

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