What happened

Shares of Translate Bio (NASDAQ:TBIO) surged 29% on Tuesday after the U.S. biotechnology company said it agreed to be acquired by French pharmaceutical giant Sanofi (NASDAQ:SNY)

So what

The all-cash deal values Translate Bio at roughly $3.2 billion, or $38 per share. That represents a premium of more than 30% above the stock's closing price on Monday. The transaction is expected to close in the third quarter, subject to regulatory and shareholder approval.

A person is turning over dice that spell mRNA vaccine.

Image source: Getty Images.

Translate Bio's messenger RNA technology is similar to that of Pfizer and Moderna, which have successfully used the tech to produce lifesaving COVID-19 vaccines. Translate Bio believes its mRNA platform could help to develop new vaccines and treatments for a wide range of ailments, such as liver and pulmonary diseases.

Now what 

Sanofi fell behind Moderna and Pfizer in the race to develop a safe and effective coronavirus vaccine. This occurred despite the fact that Sanofi has worked with Translate Bio to develop mRNA vaccines since 2018. Still, Sanofi hopes that purchasing its partner and fully integrating its mRNA platform into its operations could help it close the technological gap with its rivals.

"A fully owned platform allows us to develop additional opportunities in the fast-evolving mRNA space," Sanofi CEO Paul Hudson said in a press release. "We will also be able to accelerate our existing partnered programs already under development."

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