German drug company Merck KGaA said Monday it has struck a deal to buy U.S. biotech firm SpringWorks Therapeutics (SWTX) for around $3.9 billion, expanding its portfolio of rare disease and cancer treatments.

Shares of SpringWorks are up r✤oughly 2% in premarket trading, while Merck shares are up about 1.5% in Frankfurt trading.

Merck said it would offer $47 a share in cash for the Stamford, Conn.-based firm. That represents a 26% premium to SpringWorks' 20-day volume-weighted average price of $37.38 on Feb. 7—the day before speculation of a potential deal between the two started, Merck said. SpringWorks shares closed at $44.72 on Friday.

The transaction is expected to close in the second half of 2025, subject to SpringWorks' shareholders approval and regulatory approvals. Merck said once the deal closes, it "will immediately contribute" to its revenue and is expected to be accretive to its earnings per share pre in 2027.

"The agreed acquisition of SpringWorks is a major step in our active portfolio strategy to position our company as a globally diversified, innovation and technology powerhouse," Merck CEO Belén Garijo said. "For our Healthcare sector, it sharpens the focus on rare tumors, accelerates growth, and strengthens our presence in the U.S."