Novo Nordisk gives up battle for Metsera as Pfizer inks $10B deal

[M&A - concept waiting for mergers and acquisitions.3D rendering on yellow background.]

Novo Nordisk (NVO [https://seekingalpha.com/symbol/NVO]) on Saturday said it will no longer increase its buyout offer for Metsera (MTSR [https://seekingalpha.com/symbol/MTSR]) after Pfizer (PFE [https://seekingalpha.com/symbol/PFE]) won a bitter bidding war for the U.S. weight-loss drug developer, reaching a deal worth up to $10B.

Late Friday, New York-based Metsera (MTSR [https://seekingalpha.com/symbol/MTSR]) announced that it reached a revised merger agreement with Pfizer (PFE [https://seekingalpha.com/symbol/PFE]) to be acquired by the pharma giant for up to $86.25 per share in cash, which it has deemed superior given the evolving antitrust risks of Novo’s (NVO [https://seekingalpha.com/symbol/NVO]) bid.

“The Metsera Board of Directors has determined that the revised terms represent the best transaction for shareholders, both from the perspective of value and certainty of closing,” the company said.

“The Board of Directors has further determined that the transaction proposed by Novo Nordisk presents unacceptably high legal and regulatory risks to Metsera,” it added, noting concerns raised by the U.S. FTC over proceeding with Novo’s (NVO [https://seekingalpha.com/symbol/NVO]) deal.

Pfizer (PFE [https://seekingalpha.com/symbol/PFE]) initially agreed to buy Metsera (MTSR [https://seekingalpha.com/symbol/MTSR]) in September for $47.50 per share in cash, valuing it at $4.9B upfront, and the deal included a potential payment of up to an additional $22.50 per share as part of contingent value rights subject to the achievement of future milestones. [https://seekingalpha.com/news/4496839-pfizer-nears-73b-takeover-of-weight-loss-drugmaker-metsera-ft-reports]

Metsera (MTSR [https://seekingalpha.com/symbol/MTSR]) later confirmed it received an unsolicited buyout proposal from Novo Nordisk (NVO [https://seekingalpha.com/symbol/NVO]), which it considered superior, as it valued the company at up to $77.75 per share for a total valuation of about $9B. [https://seekingalpha.com/news/4511069-metsera-says-novo-nordisks-9b-buyout-offer-superior-pfizer-calls-bid-illusory]

Following two lawsuits from Pfizer (PFE [https://seekingalpha.com/symbol/PFE]) to block Novo’s (NVO [https://seekingalpha.com/symbol/NVO]) bid, the Danish drugmaker raised its bid to a total of $86.20 per share, indicating a total valuation of up to $10B, which, according to The Financial Times, Pfizer (PFE [https://seekingalpha.com/symbol/PFE]) later matched. [https://seekingalpha.com/news/4516864-pfizer-matches-novo-bid-for-obesity-biotech-metsera-as-takeover-battle-rages---ft]

“Following a competitive process and after careful consideration [https://www.novonordisk.com/content/nncorp/global/en/news-and-media/news-and-ir-materials/news-details.html?id=916454], Novo Nordisk will not increase its offer to acquire Metsera consistent with its commitment to financial discipline and shareholder value,” Novo Nordisk (NVO [https://seekingalpha.com/symbol/NVO]) said in a statement.

PFE’s revised bid included an upfront cash payment of $65.60 per share in addition to a CVR, which entitles Metsera's (MTSR [https://seekingalpha.com/symbol/MTSR]) shareholders to receive up to $20.65 per share in cash additionally. The companies expect to close the deal immediately after MTSR’s stockholder meeting on November 13. [https://seekingalpha.com/pr/20299576-pfizer-and-metsera-enter-into-merger-agreement-amendment-metseras-board-of-directors]

MORE ON PFIZER, NOVO NORDISK, ETC.

* Healthcare Q3 Dividend Roundup: I Prefer AbbVie Over Pfizer [https://seekingalpha.com/article/4840843-healthcare-q3-dividend-roundup-i-prefer-abbvie-over-pfizer]
* Eli Lilly, Novo Nordisk's Historic GLP-1 Pricing Deals - What Investors Need To Know [https://seekingalpha.com/article/4840321-eli-lilly-novo-nordisk-historic-glp-1-pricing-deals-what-investors-need-to-know]
* Pfizer: The Storm Has Passed -- Tailwinds Ahead [https://seekingalpha.com/article/4839345-pfizer-storm-has-passed-tailwinds-ahead]
* Eli Lilly, Novo down after U.S. drug pricing deal [https://seekingalpha.com/news/4518819-eli-lilly-novo-down-us-drug-pricing-deal]
* U.S. launches pilot payment model to bring MFN pricing to Medicaid [https://seekingalpha.com/news/4518476-us-payment-model-brings-mfn-pricing-medicaid]