Feb 6 Reuters Drugmaker Novartis AG said it will acquire MorphoSys AG, a developer of cancer treatments, for 2.7 billion euros 2.9 billion, adding a promising rare bonemarrow cancer treatment candidate to its portfolio.

Reuters first reported on Monday that Switzerlandbased Novartis was in advanced talks to acquire MorphoSys, leading to the German biotech firm39;s shares surging more than 40.

The Swiss group will offer shareholders 68.00 euros per share in cash and take MorphoSys private after the deal, which is contingent on certain conditions, including a minimum acceptance threshold of 65 of MorphoSys39; share capital and regulatory clearances, the companies said.

Novartis has been cutting jobs and costs, and spun off its generic drugs business Sandoz last year, part of a focus on fewer therapeutic areas and geographic markets. It has said its overall mergers and acquisitions strategy was focused on deals worth less than 5 billion.

Morphsys shares jumped 15 to 66.10 euros after the open, while Novartis shares gained 0.5.

The Planegg, Germany, headquartered MorphoSys will continue to operate as a separate, independent company until the completion of the deal, expected in the first half of 2024.

Novartis will own pelabresib, one of MorphoSys39; most promising drugs, which is used to fight deadly forms of cancers such as myelofibrosis, a rare type of bone marrow cancer, and certain types of knotty lymphomas.

MorphoSys said in a separate statement that its…