Health Care Company Novartis Announces Merger With Chinook Therapeutics

Novartis NVS has announced a merger with Chinook Therapeutics KDNY that is expected to be completed 2023-H2.

Under the terms of the agreement, Novartis has agreed to give Chinook Therapeutics $3.20 billion in cash in exchange for KDNY stock.

About The Companies Involved

Novartis develops and manufactures healthcare products through two business segments: Innovative Medicines and Sandoz. It generates the vast majority of its revenue from Innovative Medicines segment consisting global business franchises in oncology, ophthalmology, neuroscience, immunology, respiratory, cardio-metabolic, and established medicines.

Chinook Therapeutics Inc is a clinical-stage biotechnology company. The products of the company are focused on rare, severe chronic kidney disorders.

How A Merger Works

A merger happens when a company combines operations with another company. In practice, one company will buy the other company's stock in exchange for its own stock. In some cases, cash is used to pay for the company's stock but usually the companies agree to a stock-for-stock transaction.

Due to the exchange and acquisition of stock, a merger is similar to an acquisition. This is why the two terms are commonly grouped together as mergers and acquisitions (M&A). However, in a merger, the leadership & operations of both companies usually change dramatically, while during an acquisition this is less likely to happen.

Make sure to follow our mergers & acquisitions calendar to stay-up-to-date on the most recent M&A deals.

This article was generated by Benzinga's automated content engine and reviewed by an editor.