An investment consortium, comprising of Elliott Investment Management, Patient Square Capital and Veritas Capital, has agreed to buy Syneos Health Inc, in a deal valued at $7.1 billion, including debt, the contract research firm said on Wednesday.

Syneos shares rose 10.4% before the bell.

Syneos said the consortium will pay about $43 per share in cash, which represents a premium of about 12% to the company's last close of $38.45.

The deal comes at a time when Syneos faces challenges in winning new business, as many of its clients, which includes medium-sized biotechs, have cut spending as they have found it difficult to raise funding in a post-COVID-19 market downturn.

Deal comes days after a private-equity groups including Warburg Pincus and Advent International agreed to buy Baxter International biopharma solutions unit for $4.25 billion.

PE firms have increasingly been investing in the drug development sector, which was deemed as risky, by coming up with deals that compensate them for the uncertainty involved.

(Reporting by Bhanvi Satija and Khushi Mandowara in Bengaluru; Editing by Shailesh Kuber)