Norwalk health care data company IMS Health Inc. said it is being bought by investment funds TPG Capital and CPP Investment Board for $4 billion.
IMS shareholders are getting $22 per share under the deal, marking a 31 percent premium to the stock’s closing price of $16.81 on Wednesday.
Shares rose $4.02, or 23.9 percent, to $20.83 in morning trading. The stock earlier set a new 52-week high of $21.09.
The company said the deal is valued at $5.2 billion including the assumption of debt.
The announcement comes after weeks of speculation following media reports in October that the company was on the auction block. On Oct. 20, the company said it is exploring a variety of strategic alternatives, but did not mention the possibility of a sale.
A day prior to that, media reports prompted speculation that the company could be sold to a private equity firm, potentially garnering a 30 percent premium.
IMS said the deal has fully committed financing and its board of directors unanimously approved the buyout.
“This transaction enables our shareholders to realize substantial value from their investment in IMS with an immediate cash premium, while at the same time strengthening our position to capture long-term growth opportunities,” said IMS Chairman and CEO David R. Carlucci in a statement.
IMS expects the deal to close by the end of the first quarter of 2010.
Deutsche Bank Securities Inc. acted as financial adviser to the company, while Sullivan & Cromwell LLP acted as legal adviser. (AP)