KEY TAKEAWAYS
- Shares of Catalent soar on news Novo Holdings, the majority owner of Novo Nordisk, is acquiring the syringe maker for $16.5 billion in cash.
- The deal represents a 16.5% premium over Catalent’s pre-announcement stock price Friday.
- The acquisition expands Novo Nordisk’s production capacity and supply flexibility, particularly for its Wegovy weight loss drug.
Shares of syringe maker Catalent (CTLT) soared 10% in early trading after it signed a deal to be sold to the controlling shareholder of Novo Nordisk (NVO) for $16.5 billion.
Novo Holdings will purchase Catalent’s all outstanding shares for $63.5 per share in an all-cash transaction. The price translates to a 16.5% premium over Catalent’s share price February 2, 2024, the last trading day before the announcement.
Headquartered in Somerset, New Jersey, Catalent is the primary manufacturer responsible for filling and packaging injection pens for Novo Nordisk’s popular weight-loss drug Wegovy.
Once the deal is finalized, Novo Nordisk, which also makes the diabetes drug Ozempic, will purchase three of Catalent’s “fill-finish” sites from Novo Holdings for $11 billion in a debt transaction, the company said in a separate statement. The sites are located in Italy, Belgium and the US, and have ongoing collaborations with Novo Nordisk.
“The acquisition complements the significant investments we are already doing in active pharmaceutical ingredients facilities, and the sites will provide strategic flexibility to our existing supply network.”said Lars Fruergaard Jørgensen, president and chief executive officer at Novo Nordisk.
Novo Nordisk said the purchase of the three sites may have a “low single-digit negative impact on operating profit growth in both 2024 and 2025.”
Novo Holdings and Catalent said they expect their deal to close toward the end of the year, subject to shareholder and regulatory approvals.
Catalent was up 9.87% at at $59.91 at 10.27 a.m. ET Monday following the news though are down 11% in the past year. The American depository receipts (ADRs) of Novo Nordisk rose 2.89%.