What’s cooler than $150 million? $1 billion

Peloton Therapeutics, a company developing treatments for cancer, was about 48 hours away from a $150 million IPO when it made a pivot. Instead of going public, it’s selling itself to Merck for $1 billion in cash.

It makes sense for Peloton’s private investors, which include the Column Group and Topspin Partners. The IPO would have valued the company at around $740 million, but its investors would have to weather 180 days of open trading before selling any shares. By contrast, the sale gives them immediate cash and the chance to earn $1.2 billion more if Peloton's drugs actually work. It's also arguably positive for Merck, which would have likely paid a heavier premium if it had waited until Peloton was public before striking a deal.

Really the only losers are the investment bankers. J.P. Morgan, Citigroup, and Jefferies had signed up to run the Peloton IPO, and now that it’s not happening, the banks will have to go without the bookrunning fees they would have collected. They’ll probably be OK though.