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2020-08-31| M&A

Nestlé to Acquire Aimmune Therapeutics in a $2.6 Billion Merger Agreement

by Ruchi Jhonsa
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On 31st August, the duo entered into a definitive agreement where Societes des Produits Nestlé, S.A (SPN) will buy the California biotech for its recently FDA-approved peanut allergy drug.

Food allergies can be troublesome but also life-threatening for children and adults living with the problem. In recent years, a growing number of people had to grapple with such challenges. Up to 240 million people worldwide suffer from food allergies, the most common of which is peanut allergy which tripled in kids between 1997 and 2008. Up until now, there was no FDA-approved treatments for this problem. But at the beginning of this year, the FDA approved Aimmune’s PALFORZIA, making it the world’s first treatment for peanut allergy.

Aimmune has been at the forefront of developing medications for peanut and other food allergies. Its characterized oral desensitization immunotherapy (CODIT) approach desensitizes patients to allergens by oral administration of an increasing amount of allergens. The potential of this approach was realized by Nestlé Health Science (NHSc), a subsidiary of Nestlé group in 2016, which led the company to make a strategic collaboration with Aimmune to advance the latter’s pipeline of food allergy treatments. Aimmune, in return, benefitted from the strong presence of Nestlé globally as well as its expertise in nutritional science.

On 31st August, the duo entered into a definitive agreement where Societes des Produits Nestlé, S.A (SPN) will buy Aimmune for just under $2 billion, subtracting the latter’s cash and debts and prior investments made by Nestlé Health Science. SPN is a part of Nestlé Health Science and a wholly-owned subsidiary of Nestlé S.A. CEO of Nestlé health science, Greg Behar, believes that this transaction will combine Nestlé’s nutritional science leadership with one of the most innovative companies in food allergy treatment to create a world leader in food allergy prevention and treatment.

“The agreement with Nestlé recognizes the value created by years of commitment and dedication to our mission by the team at Aimmune. Delivering PALFORZIA, the world’s first treatment for food allergy, is a game-changing proposition in the biopharmaceutical industry and is transformative for the lives of millions of people living with potentially life-threatening peanut allergy,” said Jayson Dallas, MD, President and Chief Executive Officer of Aimmune.

The inclusion of Aimmune will cost Nestlé Health Science $34.50 per share in cash. Nestlé is also offering a 174% premium to Aimmune’s closing share price of $12.60 on 28th August. The company will commence acquiring all the outstanding shares that are not already owned by NHSc, while Aimmune will take the unanimous recommendation of the independent member of the Aimmune board to tender their shares to SPN.

The transaction is expected to close in the fourth quarter of 2020, depending upon whether all the conditions in the tender offer are complete. After all the formalities related to tender are completed, SPN will merge with Aimmune, where Aimmune will be the surviving company. The agreement also includes a customary termination clause for both the companies in case they decide not to go forward with the deal.

“This acquisition provides strong value for our shareholders and ensures a level of support for PALFORZIA and our pipeline that will further enhance their potential for patients around the world living with food allergies. Aimmune appreciates the continued strong collaboration with Nestlé Health Science dating back to 2016 through their support as a shareholder and board member, as well as through their consumer/nutrition strength and experience. Their extensive capabilities and global reach, as well as their alignment with our vision of pioneering treatments and solutions for food allergies, are a strong fit for our company,” said Jayson Dallas.

Related Article: Aimmune’s PALFORZIA™ Scores FDA Win, Becomes the First-Ever Treatment For Peanut Allergy

References
  1. https://ir.aimmune.com/news-releases/news-release-details/aimmune-therapeutics-enters-definitive-agreement-societes-des
  2. https://www.nestlehealthscience.com/newsroom/press-releases/nestle-to-acquire-aimmune-therapeutics
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