Shares of PPD Inc. PPD, +12.10% rallied 7.3% in premarket trading Thursday, after Thermo Fisher Scientific Inc. TMO, -1.40% confirmed an agreement to buy the pharmaceutical-testing company in a cash deal valued at $17.4 billion, including $3.5 billion in debt. Thermo Fisher shares gained 3.1% ahead of the open. Under terms of the deal, Thermo Fisher will pay $47.50 for each PPD share outstanding, which is a 10.5% premium to Wednesday’s closing price of $43.00, and implies a market capitalization for PPD of $16.64 billion. The deal was reported by The Wall Street Journal late Wednesday. Thermo Fisher said it expects cost synergies of about $75 million after the deal’s closing, which is expected to occur by the end of 2021, and expects the deal to add $1.40 to adjusted earnings per share in the first 12 months after the close. PPD’s stock has rallied 25.7% year to date through Wednesday and Thermo Fisher shares have edged up 2.6%, while the S&P 500 SPX, -0.41% has gained 9.8%.
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