Shares of Catalent (CTLT +0.00%) rose by 9.7% on Monday after the pharmaceutical contract manufacturing and drug delivery technology specialist agreed to be acquired by Novo Holdings, the parent company of Novo Nordisk (NVO +0.77%).
NYSE: CTLT
Key Data Points
Novo Nordisk is bringing Catalent under its wing
In a press release Monday, Catalent announced it had agreed to be acquired by Novo Holdings for $63.50 per share in cash -- a 16.5% premium from Friday's closing price and a nearly 48% premium to its 60-day volume-weighted average price. The deal puts an enterprise value of $16.5 billion on Catalent.
"We look forward to benefiting from Novo Holdings' significant resources to accelerate investment in our business and enhance key offerings as we continue to offer premium development and manufacturing solutions for pharma and biotech customers," stated Catalent CEO Alessandro Maselli.
Novo Nordisk, for its part, will leverage Catalent's status as a key manufacturing subcontractor to expand its fill-finish capacity to better meet the high demand for its popular obesity drug, Wegovy.
What's next for Catalent shareholders?
The agreement still requires approval from both regulators and Catalent stockholders. But assuming all goes as planned, it should close toward the end of 2024.
With Catalent shares now trading at only a modest discount to the agreed acquisition price, I think most Catalent investors would do well to consider selling now and putting their money to work in other promising stocks -- unless waiting longer to sell would qualify them for lower capital gains tax rates on their profits.
