DARMSTADT/MINNEAPOLIS: German drugmaker Merck KGaA said on June 25 it would acquire U.S. life sciences company Bio-Techne for US$11.3 billion, its largest deal in more than a decade, as it expands its business supplying tools for drug research and advanced therapies.

Merck offered $73 per Bio-Techne share, representing a 24 percent premium to the company's closing price on June 24. Bio-Techne shares rose 19 percent to $70.33, while Merck KGaA shares gained nearly five percent.

The acquisition would strengthen Merck's life sciences division, which the company sees as a major source of future growth. It would also expand its presence in advanced biological research, cell and gene therapy, precision diagnostics, and drug development.

Bio-Techne supplies research reagents, proteins, antibodies, analytical instruments, and other products used by scientists and pharmaceutical companies.

Some analysts said the transaction was a strong strategic fit and was unlikely to face major regulatory obstacles.

Merck appears to be getting an attractive asset with strong long-term potential, despite current pressures in the research tools market, Leerink analyst Puneet Souda said in a note.

"We have to look into valuations, and here, of course, timing matters," Merck KGaA CEO Kai Beckmann told reporters on a call.

On a separate call with analysts, Beckmann said the valuation at which Merck was acquiring Bio-Techne "wasn't possible two years ago," when demand for drug research tools was at an all-time high during the COVID pandemic.

The transaction is Beckmann's first major acquisition since he became chief executive in May, succeeding Belén Garijo. Garijo had pursued several acquisitions, including Exelead and SpringWorks Therapeutics, to strengthen Merck's positions in key categories.

The Bio-Techne acquisition is Merck's biggest since its $17 billion purchase of Sigma-Aldrich in 2014, which significantly expanded its research tools division.

Merck Life Science CEO Jean-Charles Wirth said Bio-Techne would add scale through its catalog of consumables, which includes 6,000 proteins and 425,000 antibodies.

The acquisition would increase Merck's presence in high-growth areas of research tools, advanced therapies, and precision diagnostics, which Wirth said represent a $27 billion market opportunity.

The company said it would fund the transaction through a combination of cash and debt. Merck had cash and cash equivalents of about 2.74 billion euros, or $3.11 billion, as of March 31.

The deal is expected to close in late 2026 or early 2027. Merck expects to generate about 140 million euros in cost savings three years after the transaction closes.