Acceleron falls below averages, but Avoro looks opportunistic

It did not take long: on the day of Merck & Co’s $11.5bn move on Acceleron one of the target company’s holders, Avoro Capital, slammed the price as too low, citing the implied 38% premium as falling well below recent industry norms. The Bloomberg data Avoro relies on suggest 89% as the average premium for public biopharma takeovers worth above $1bn since the start of 2020. Evaluate Pharma shows the Acceleron premium coming above just two acquisitions in this universe, that of Emishpere and Principia, though of course it depends what comparison criteria are used. Still, as Vantage Analysis has argued, Acceleron’s market cap had tended to stay ahead of sellside expectations, and even before rumours of a takeover emerged the stock had climbed 2.5-fold since the start of last year. Moreover, Avoro’s move appears opportunistic: the fund says it holds a 7% stake, but an August 16 SEC filing still has it at 4.9%. Accceleron’s latest disclosure, from April, cites leading holders as Bristol Myers Squibb (11.6%), T Rowe Price (8.8%) and Vanguard (8.3%), and it is assumed that these all support the Merck acquisition.