DJ Arix Bioscience PLC: VelosBio to be acquired by Merck for $2.75 billion
Arix Bioscience PLC (ARIX)
Arix Bioscience PLC: VelosBio to be acquired by Merck for $2.75 billion
05-Nov-2020 / 11:38 GMT/BST
Dissemination of a Regulatory Announcement, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
Arix Bioscience plc
VelosBio to be acquired by Merck for $2.75 billion
LONDON, 5 November 2020: Arix Bioscience plc ("Arix", LSE: ARIX) a global
venture capital company focused on investing in and building breakthrough
biotech companies, notes that its portfolio company VelosBio Inc.
("VelosBio"), today announced that it has entered into a definitive
agreement with Merck (NYSE: MRK), known as MSD outside of the United States
(U.S.) and Canada, pursuant to which Merck, through a subsidiary, will
acquire all outstanding shares of VelosBio for $2.75 billion in cash,
subject to certain customary adjustments. The sale of VelosBio is expected
to deliver net proceeds to Arix of approximately $185 million (GBP142
million[1]), representing a 12x return on Arix's GBP12 million invested
capital. This equates to a GBP121 million (89p per share) increase in the
gross value of Arix's holding in VelosBio of GBP21 million[2].
VelosBio is a privately held, clinical-stage U.S. biopharmaceutical company,
committed to developing first in class cancer therapies targeting tyrosine
kinase-like orphan receptor 1 (ROR1), a novel oncology target. VelosBio's
lead investigational candidate is VLS-101, an antibody-drug conjugate (ADC)
targeting ROR1 that is currently being evaluated in a Phase 1 and a Phase 2
clinical trial for the treatment of patients with hematologic malignancies
and solid tumours, respectively. In addition, VelosBio is developing a
preclinical pipeline of next-generation ADCs and bispecific antibodies
targeting ROR1 with the potential to complement VLS-101 by offering
alternative methods of tumour cell killing.
Arix co-led the Series A financing and joined the VelosBio Board of
Directors in October 2018. VelosBio has since progressed from a pre-clinical
to clinical stage company and completed an oversubscribed Series B financing
in July 2020, supported by new and existing shareholders.
Jonathan Tobin, Managing Director at Arix and VelosBio Board Director,
commented: "Merck's acquisition of VelosBio is a testament to the VelosBio
leadership team, the pipeline they have built and the development strategy
they have executed. We have worked closely with the VelosBio team and our
co-investors through the company's early development and we are incredibly
proud of the progress the company has made in such a short period of time.
As one of the top forces in oncology drug development globally, Merck makes
the perfect partner to maximise the potential benefit of VelosBio's lead
candidate, VLS-101, for the treatment of patients with cancer."
Naseem Amin, Executive Chairman of Arix, commented: "The trade sale of
VelosBio to Merck is a major milestone for Arix, marking the first strategic
acquisition from our portfolio, just four years since Arix's inception. This
acquisition validates our ability to identify, assess and develop
breakthrough biotechnology companies globally and to generate superior
returns for our shareholders. It is also evidence of the potential we see in
our maturing portfolio and our expectations of further significant value
inflection points ahead, with the potential to deliver additional
shareholder value.
"The strong return on this investment in approximately two years provides a
very significant increase in our Net Asset Value ("NAV"), moving us
significantly closer to our December 2023 NAV goal of GBP500 million, that we
set out in our 2020 interim results. This transaction puts us in a strong
position to continue to execute our strategy of providing support and
flexible, long-term capital to the most innovative biotech companies across
the globe, which we believe have the potential to deliver transformative new
treatments to patients and superior returns to our shareholders."
The closing of the transaction, which is subject to approval under the
Hart-Scott-Rodino Antitrust Improvements Act and other customary conditions,
is expected by the end of 2020.
[ENDS]
Enquiries
For more information on Arix, please contact:
Arix Bioscience plc
Charlotte Parry, Head of Investor Relations
+44 (0)20 7290 1072
charlotte@arixbioscience.com
Optimum Strategic Communications
Mary Clark, Supriya Mathur, Shabnam Bashir
T: +44 (0) 20 3950 9144
optimum.arix@optimumcomms.com
This announcement includes information that is inside information as defined
in Article 7 of the Market Abuse Regulation No.596/2014. The person
responsible for arranging for the release of this announcement on behalf of
Arix Bioscience plc is Robert Lyne, General Counsel Arix Bioscience plc.
About Arix Bioscience plc
Arix Bioscience plc is a global venture capital company focused on investing
in and building breakthrough biotech companies around cutting edge advances
in life sciences.
We collaborate with exceptional entrepreneurs and provide the capital,
expertise and global networks to help accelerate their ideas into important
new treatments for patients. As a listed company, we are able to bring this
exciting growth phase of our industry to a broader range of investors.
www.arixbioscience.com [1]
About VelosBio
VelosBio Inc. is a clinical-stage biopharmaceutical company committed to
transforming the lives of patients with cancer by developing first-in-class
therapies targeting ROR1. Its lead candidate, VLS-101, is a ROR1-directed
ADC being developed for patients with hematologic malignancies and solid
tumors. The company is utilizing its ROR1-targeting antibody-based
technology to develop a pipeline of ADCs and bispecific antibody product
candidates for the treatment of hematologic malignancies and solid tumors.
VelosBio is headquartered in San Diego. For more information, please visit
www.velosbio.com [2].
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[1] At prevailing GBP/USD FX rate on 5 November 2020. Arix proportion of
$2.75 billion proceeds based on 6.8% fully diluted shareholding, as
disclosed in Arix Bioscience plc 30 June 2020 interim financial statements
[2] GBP17.4 million valuation at 30 June 2020 plus GBP3.2 million investment in
July 2020, as reported at interim results 2020
ISIN: GB00BD045071
Category Code: MSCU
TIDM: ARIX
LEI Code: 213800OVT3AHQCXNIX43
OAM Categories: 2.2. Inside information
Sequence No.: 87310
EQS News ID: 1145794
End of Announcement EQS News Service
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(END) Dow Jones Newswires
November 05, 2020 06:38 ET (11:38 GMT)
