Stemline Therapeutics STML Stock News

Stemline Therapeutics Inc (NASDAQ: STML) is having a great start to the trading session, trading on gains of more than 150% early on. The gains come after the company announced that it would be acquired by Menarini Group. Here’s what you need to know:

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STML Stock Rockets On Acquisition News

In the press release, Stemline Therapeutics said that it has entered into a definitive agreement with Menarini Group. Under the terms of the agreement, Menarini will acquire the company in a deal valued at $677 million.

The terms of the agreement state that a wholly owned subsidiary of Menarini will commence a tender offer for all outstanding STML shares. Shareholders will be offered $12.50 per share. $11.50 of this total price per share will be paid in cash. Shareholders will also receive one non-tradeable Contingent Value Right.

The CVR will lead to $1.00 per share being paid upon the completion of the first sale or consumption by the general public of ELZONRIS in BPDCN in the UK, France, Spain, Germany or Italy. Of course, the sale would require regulatory approval.

In a statement, Elcin Barker Ergun, CEO at Menarini Group, had the following to offer:

Stemline is an excellent fit for Menarini, enabling us to expand our presence in the U.S. with an established biopharmaceutical company focused on developing oncology therapeutics. Through this acquisition, we will continue to strengthen our portfolio and pipeline of oncology assets and deliver novel therapies around the world. We look forward to uniting together with the Stemline team to advance our shared mission of serving patients.

The above statement was followed up by Ivan Bergstein, M.D., Chairman, CEO and Founder of STML. Here’s what he had to say:

Joining Menarini represents a unique opportunity for Stemline to advance the commercialization of ELZONRIS across the globe and to accelerate the development of our pipeline of oncology assets. We have transitioned Stemline over the last several years into an established commercial-stage operation with a novel treatment, a growing pipeline and a strong foundation. We are excited to be combining with a like-minded organization in Menarini, in a transaction that will deliver immediate and significant cash value to our shareholders, while also allowing our shareholders to participate in the future upside of ELZONRISā€™s European launch. We look forward to working closely together on our unified goal of helping and delivering hope to patients worldwide.

This News Is Huge

Not only did Stemline Therapeutics announce an acquisition today, the value of the acquisition was massive. In fact, the price paid here was more than double the company’s market cap as of the close of business on Friday. That’s an incredible premium.

Moreover, there’s more room for further profits here. If commercialization takes place in one of the companies mentioned above, each share of STML will yield yet another $1.00 in returns.

All in all, this was a big win for all involved.

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