Trillium (TSX:TRIL) stock is rising on Pfizer deal: Time to buy?

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 Trillium (TSX:TRIL) stock is rising on Pfizer deal: Time to buy?
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Highlights 

  • Trillium Therapeutics (TSX:TRIL) stocks are on the rise following the announcement Pfizer’s plans to buy it.
  • At the time of writing this, Trillium stocks were up by nearly four per cent (8.38AM EST) at C$ 7.81.
  • Pfizer stocks were also trading in the green territory in the premarket trading hours on Monday

Trillium Therapeutics Inc (TSX: TRIL) saw its stocks rise after pharmaceutical giant Pfizer Inc (NYSE: PFE) announced on Monday, August 23, that it is set to acquire the Canadian drug maker.

At the time of writing this, Trillium stocks were up by nearly four per cent (8.38AM EST) at C$ 7.81.

Pfizer stocks were also trading in the green territory in the premarket trading hours on Monday, up by over three per cent.

Let’s take a closer look at the acquisition deal.

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Pfizer buys Trillium – Key insights

Pfizer is set to purchase Trillium in a US$ 2.26 billion deal in efforts to “reinforces [its] commitment to pursue scientific breakthroughs”.

In September last year, Pfizer bought a stake worth US$ 25 million in the clinical stage immuno-oncology firm, which is engaged in the development of innovative therapies for cancer. The deal saw Pfizer buy some 2.3 million Trillium shares for a price of about US$ 10.88 per piece.

Now, the US-based pharma player is set to acquire its remaining outstanding shares for a price of US$ 18.5 apiece, which is a 203.8 per cent premium on its last closing stock price.

Financial firms BofA Securities Inc and Centerview Partners LLC are to play the role of advisers for Pfizer and Trillium, respectively, for this deal.

Also read: Trillium Therapeutics and WELL Health: 2 COVID health stocks to explore in October

                       

Trillium stock is rising on Pfizer deal: Time to buy?

 

Trillium Therapeutics (TSX: TRIL)

Stocks of Trillium Therapeutics have declined by nearly 43 per cent in the past one year and dipped over 58 per cent this year.

The Canadian scrip dwindled to its 52-week low of C$ 7.48 on August 20, 2021, and has since climbed by more than four per cent.

Trillium posted a price-to-earnings (P/E) ratio of 8.8 and price-to-book (P/B) ratio of 2.64.

Also read: Catabasis (CATB) rockets 580%: Is this pharma stock a buy?

Bottomline

The healthcare sector at large has noted some significant mergers recently, including that of another cancer therapy research firm Forty Seven Inc, which was purchased pharma giant Gilead Sciences Inc (NASDAQ: GILD) last year.

A Reuters report points that blood cancer saw over one million new diagnoses and more than 700,000 deaths across the world in 2020.

This unfortunate rise in blood cancer cases could lead to an increasing demand for Trillium’s services, which in turn could benefit Pfizer.

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