Drugmaker Merck & Co is in advanced talks to buy cancer-focused biotech company Seagen Inc in a deal; that could be worth roughly $40 billion or more, the Wall Street Journal.
The companies are discussing a price above $200 a share for Seagen; the report said, citing people familiar with the matter. Seagen declined to comment on the report; while Merck did not immediately respond to a Reuters request for comment outside business hours.
Merck and Seagen are seeking to seal a deal on or before the announcement of Merck’s second-quarter earnings set, the WSJ report said. Talks have been underway for a while on the deal, which the Journal first reported last month.
BMO Capital analysts said there is “little question” of Seagen’s fit in Merck’s long-term growth; but raised concerns on heightened regulatory scrutiny. The deal talks come at a time when several big corporate deals have been shelved this year. This is as a downturn in equity markets hurts company valuations while rising borrowing costs make deal financing costlier and harder to access.
Last week, U.S. department store chain Kohl’s called off its sale to Franchise Group (FRG.O) after months of negotiations; citing sinking markets and difficult financing conditions.
Walgreens Boots Alliance scrapped its plan to sell its UK pharmacy chain Boots; saying no third party was able to make an adequate offer due to the turmoil in global financial markets.