Merck KGaA Plans $4 Billion Bond Issuance to Fund SpringWorks Acquisition

According to informed sources, Germany's Merck KGaA plans to issue approximately $4 billion in U.S. investment-grade bonds to fund its acquisition of SpringWorks Therapeutics. Some informed sources stated that the bond transaction will be divided into up to four tranches with maturities of three, five, seven, and ten years, respectively. The proceeds from the bond issuance will be used to refinance the $3.9 billion bridge loan for the acquisition of biopharmaceutical company SpringWorks.

Sources added that Merck has invited several banks, including Barclays, BBVA, Bank of America, JPMorgan Chase, and Societe Generale, to start telephone communications with bond investors from Monday.

In April this year, Merck Group officially announced the acquisition of U.S.-based biopharmaceutical company SpringWorks Therapeutics for $47 per share in cash, with an equity value of $3.9 billion. This transaction represents Merck's largest acquisition in the healthcare sector in recent years and marks a strategic deepening in the field of rare tumor treatments. The company expects the acquisition of SpringWorks to be completed in the second half of this year.

Data shows that the core assets of SpringWorks Therapeutics are two FDA-approved FIC drugs. OGSIVEO® (nirogacestat) – the world's first systemic standard therapy for the treatment of adult progressive desmoid tumors, a condition that previously lacked effective medications, with patients relying on surgery or radiotherapy. GOMEKLI™ (mirdametinib) – the first approved drug for the treatment of neurofibromatosis type 1-associated plexiform neurofibromas (NF1-PN) in both adults and children, covering patients aged 2 years and above, filling a decades-long gap in this field.

Through this acquisition, Merck not only secures two drugs but also directly enters the U.S. market – the world's largest pharmaceutical market. Currently, OGSIVEO® has been launched in the U.S., and the European Marketing Authorization Application (MAA) for GOMEKLI™ has entered the EMA review stage, with approval expected in the second quarter of 2025. Leveraging Merck's global commercialization network, these therapies are expected to accelerate their entry into uncovered regions such as Europe and Asia, benefiting more patients with rare tumors.

Editor: Yu Jian SF069