Consortium led by Nordic Capital, Permira to acquire Bavarian Nordic

A consortium led by Nordic Capital and Permira has agreed to acquire vaccine maker Bavarian Nordic for 233 Danish crowns per share in an all-cash offer, valuing the company at approximately 19 billion crowns ($2.98 billion). This represents a 21% premium over Bavarian Nordic's closing price last Wednesday, and the company has recommended investors accept the bid. The deal, which follows a 24% surge in Bavarian Nordic's shares on news of potential talks, is contingent on the consortium securing over 90% of shares and voting rights, after which Bavarian Nordic will be delisted from Nasdaq Copenhagen.

Analysis

A consortium, led by private equity firms Nordic Capital and Permira, has made a definitive all-cash offer to acquire vaccine manufacturer Bavarian Nordic for 233 Danish crowns per share. This bid values the company's equity at approximately 19 billion DKK ($2.98 billion) and represents a significant 21% premium over its closing price of 192.50 DKK last Wednesday. The market had already anticipated a potential transaction, with the stock jumping as much as 24% on Thursday following confirmation of talks. Bavarian Nordic's board has formally recommended that shareholders accept the offer, a key endorsement that increases the probability of the deal's success. The transaction is contingent upon the acquirer, Innosera, securing acceptances for over 90% of Bavarian Nordic's shares and voting rights. Upon completion, the acquirer intends to delist the company from Nasdaq Copenhagen, transitioning it to private ownership.

Key Decisions for Investors

• Existing shareholders should consider accepting the offer to lock in the 21% premium, as the board's recommendation and all-cash nature of the bid suggest a high probability of completion.
• Arbitrage-focused investors should note that the primary remaining risk is the deal failing to meet the 90% shareholder acceptance threshold, which would likely cause the share price to revert towards its pre-announcement levels.
• Given the plan to delist Bavarian Nordic, the investment case is now almost entirely event-driven, focused on the successful closure of the acquisition rather than the company's future fundamentals as a publicly traded entity.