Small caps last week: Deals for Silence and Braze, hair-loss pill success

Last week, Merck agreed to acquire UK biotech Silence Therapeutics at a 130% premium, sending the stock soaring to more than twice its previous closing price. Meanwhile, Veradermics reported successful trial results for its hair-loss pill, and Salesforce agreed to buy marketing platform Braze for $5.66 billion, keen to use AI to deliver more personalized customer interactions. These stories headline our recap of happenings in the small-cap space for the week of October 19-23.

Germany’s Merck has agreed to acquire UK biotech Silence Therapeutics. Merck offered $20 in cash for each American depositary share, a 130% premium to the closing price on October 16, the last trading day before the deal was announced. The transaction values Silence’s equity at approximately $1.3 billion and gives it an enterprise value, which accounts for cash and debt, of $1.1 billion. Silence shares surged 125.6% on Monday to $19.58 apiece.

The acquisition will add Silence's divesiran to the Merck pipeline. The experimental treatment targets polycythemia vera, a rare blood cancer in which the body produces too many red blood cells. The drug is ready to start phase III clinical trials and, according to both companies, has the potential to become best in class.

Silence develops medicines based on RNA interference, a mechanism that suppresses the activity of specific genes. Scientists Andrew Fire and Craig Mello received the 2006 Nobel Prize in Physiology or Medicine for discovering it.

According to MarketWatch data, Silence has four “hold” ratings versus one “buy” call. The average target price of $20 per share is basically in line with the current market price.

Biotech Veradermics has reported successful phase III trial results for VDPHL01, its hair-loss pill. The stock rose 12.4% on Monday to $122.28 per share. The trial enrolled more than 500 men with mild to moderate male pattern hair loss and met all primary and secondary endpoints. According to the company, the drug was generally well tolerated.

VDPHL01 is an extended-release oral formulation of minoxidil. In the U.S., minoxidil pills are approved to treat severe high blood pressure, while doctors prescribe them off-label for hair loss. Veradermics’ drug could become the first FDA-approved nonhormonal pill to treat male pattern hair loss, which affects 50 million men in the U.S., the company notes.

All seven analysts covering the stock rate it a “buy,” according to MarketWatch data. Their average target price of $164.83 per share implies around 22.8% upside from Friday’s close.

Investment bank Needham has initiated coverage of Victoria’s Secret with a “buy” rating at a target price of $106 per share, implying around 17% upside from Friday’s close.

Analyst Tom Nikic sees the popularity of weight-loss drugs as a long-term catalyst: consumers who lose weight may need smaller lingerie sizes. So far, however, adoption of GLP-1 drugs has had a minimal impact on the retailer’s sales, CEO Hillary Super previously said.

Nikic also sees growth opportunities in regaining lost market share and expanding PINK, swimwear, and activewear. For the second quarter of its fiscal 2026, Victoria’s Secret reported revenue growth of 10% to $1.61 billion, while adjusted earnings almost tripled to $0.95 per share. The management raised its full-year revenue guidance to $7.10-7.18 billion.

Salesforce, a provider of cloud-based customer relationship management software, has agreed to acquire marketing platform Braze. The deal gives Braze an enterprise value of $5.66 billion. Holders of Class A common stock will receive $47.50 in cash per share, approximately 58% above the closing price on Monday, the day before the deal was announced. Following the announcement on Tuesday, Braze shares jumped 51.7% to $45.57 apiece.

The acquisition should bolster Salesforce’s marketing unit, where revenue has been essentially flat or declining in several recent quarters, Bloomberg reports. Braze processes customer behavior data in real time and helps companies personalize messages across mobile apps, sites, email, and messaging services. AI helps select the offers, channels, and timing of those communications. Salesforce plans to close the transaction in its fiscal 2028, subject to approval by Braze shareholders and regulators.

Following the acquisition announcement, several analysts revised their rating on Braze. The stock now has 19 “hold” ratings versus two “buy” calls, according to MarketWatch data. The average target price is $46.50 per share, a dollar below Salesforce’s offer.