TESARO Inc (NASDAQ: TSRO) is having an incredibly strong start to the trading session this morning, and for good reason. The company announced that it would be acquired by GlaxoSmithKline (GSK) this morning, exciting investors and sending the stock on a run for the top. Today, we’ll talk about:
- The acquisition;
- what we’re seeing from TSRO as a result; and
- what we’ll be watching for with regard to the stock ahead.
TSRO Announces Acquisition
As mentioned above, TESARO is having a great start to the trading session in the pre-market hours this morning after announcing that it will be acquired. In a press release issued early this morning, the company said that it will be acquired by GSK for a total price of about $5.1 billion.
In a statement, Emma Walmsley, CEO at GSK, had the following to offer with regard to the TSRO acquisition:
The acquisition of TESARO will strengthen our pharmaceuticals business by accelerating the build of our oncology pipeline and commercial footprint, along with providing access to new scientific capabilities. This combination will support our aim to deliver long-term sustainable growth and is consistent with our capital allocation priorities. We look forward to working with TESARO’s talented team to bring valuable new medicines to patients.
The above statement was followed up by Lonnie Moulder, CEO at TSRO. Here’s what he had to say:
This transaction marks the beginning of a new global partnership that will accelerate our oncology business and allow our mission of delivering transformative products to individuals living with cancer to endure. Our Board and Management team are very pleased to announce this transaction, and we are grateful to the management team at GSK for their tremendous vision and the opportunity to preserve and build upon the impact we have had in the cancer community to date.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to work in the market is that the news leads to moves. In the case of TESARO, the news proved to be overwhelmingly positive. After all, the acquisition comes at an incredibly strong premium, providing immediate value to shareholders. So, it’s not surprising to see that excited investors are pushing the stock for the top in the market this morning. As is normally the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (7:50), TSRO is trading at $74.16 per share after a gain of $27.78 per share or 59.90% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on TSRO. In particular, we’re interested in following the story surrounding the acquisition. While the agreement is a definitive one, the transaction is still subject to customary closing conditions as well as regulatory approval. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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