The French drugmaker will offer 5.45 euros in cash, the companies said in a joint statement on Monday, a premium of 272% to Kiadis' closing share price on Oct. 30.
Shares in Kiadis, focused on cell-based immunotherapy products for the treatment of cancer, were up 245% in early trading. Sanofi shares were up 1.18%.
Kiadis owns a platform based on a so-called "allogeneic natural killer" that can seek and identify malignant cancer cells.
"We believe Kiadis 'off the shelf' K-NK cell technology platform will have broad application against liquid and solid tumors, and create synergies with Sanofi's immuno-oncology pipeline, providing opportunities for us to pursue potential best-in-disease approaches," said John Reed, global head of research and development at Sanofi.
The deal is the latest in a series of bolt-on transactions for Sanofi. In August, it spent $3.7 billion to buy U.S. autoimmune diseases specialist Principia Biopharma following a $2.5 billion investment to acquire immuno-oncology treatments group Synthorx in December last year.
Sanofi was late to capitalise on the takeoff of immunotherapy - drugs that activate the bodyâ€™s immune system to attack tumor cells - in the early 2010s.
It is now trying to catch up and is focusing on a pipeline of several medicines that it hopes will secure it a piece of the $100 billion-a-year cancer drug market.
Sanofi said Kiadis' medicines will be developed alone and in combination with Sanofi's existing platforms.