Diagnosis Merger

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What's going on?

AstraZeneca might not want to operate heavy-machinery for 24 hours: the UK drugmaker agreed to buy US biotech company Alexion for a dizzying $39 billion over the weekend, in one of this year’s biggest mergers.

What does this mean?

AstraZeneca hit the headlines not long ago for developing an effective coronavirus vaccine alongside the University of Oxford. But like all of us, its looking forward to not having to think about the pandemic every day, and its merger with Alexion will give it an excuse to shift its focus onto something else entirely: rare diseases.


Both companies seem to have been hunting for a deal for a while now. Alexion, for its part, has been under pressure to find a buyer from an activist investor whos been pushing for a change in company strategy. AstraZeneca, meanwhile, has reportedly been determined to take advantage of a soaring share price by using its shares to pay for new acquisitions.

Why should I care?

For markets: Odd couple.


AstraZenecas shares fell 6% on the news, which is more common than youd think. A buyers share price often falls after an acquisition announcement, with investors worried either that its paying too much for the deal or that itll struggle to successfully integrate the new business with its own. The latter seems to be their biggest concern in this particular case: its not like theres a lot of overlap between the two companies products, after all.



The bigger picture: No more playing games.


Dealmakings having a bit of a moment, with last quarter smashing records and this one on track to do it all over again. And its not slowing down just because its almost Christmas: social media firm Reddit bought TikTok-rival Dubsmash on Monday in a bid to keep up with the surge in popularity of video-sharing, while video game giant Electronic Arts announced itd be buying rival studio Codemasters in a deal worth $1.2 billion.

Originally posted as part of the Finimize daily email.

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