Akero Therapeutics Announces Closing of Upsized Public Offering of Common Stock and Pre-Funded Warrants and Full Exercise of Underwriters’ Option to Purchase Additional Shares

Rhea-AI Summary

Akero Therapeutics (NASDAQ: AKRO) has successfully closed its upsized public offering, raising approximately $402.5 million in gross proceeds. The offering consisted of two components: 6,427,170 shares of common stock priced at $48.00 per share (including the full exercise of underwriters' option for additional 1,093,750 shares), and 1,958,247 pre-funded warrants at $47.9999 per warrant with a $0.0001 exercise price.

The offering was managed by J.P. Morgan, Morgan Stanley, and Jefferies as joint book-running managers, with UBS Investment Bank acting as co-manager. The securities were offered through an automatically effective shelf registration statement previously filed with the SEC.

Positive

• Substantial capital raise of $402.5 million strengthening the company's financial position
• Full exercise of underwriters' option indicates strong market demand
• Pre-funded warrants structure provides flexibility in capital raising while minimizing immediate dilution

Negative

• Significant dilution for existing shareholders due to large share issuance
• Substantial increase in outstanding shares could pressure stock price

Insights

Financial Analyst

This substantial $402.5 million capital raise represents a significant strategic move for Akero Therapeutics, demonstrating strong institutional investor confidence in their metabolic disease pipeline. The full exercise of the underwriters' option to purchase additional shares, along with the upsized offering, indicates robust demand and positive market sentiment.

The structure of the offering, combining common stock with pre-funded warrants, provides financial flexibility while minimizing immediate dilution. The minimal $0.0001 exercise price for the warrants essentially makes them equivalent to equity, suggesting sophisticated investors' long-term commitment to the company's potential.

The timing of this offering is particularly strategic, as it substantially strengthens Akero's balance sheet to support their clinical development programs. With top-tier investment banks like J.P. Morgan, Morgan Stanley and Jefferies leading the offering, this raises confidence in the company's execution capability and market positioning.

This financing provides Akero with a significant runway to advance their metabolic disease treatments through critical clinical milestones. The successful completion at $48.00 per share, close to the current market price, suggests minimal pricing pressure and strong institutional support for the company's valuation.

SOUTH SAN FRANCISCO, Calif., Jan. 30, 2025 (GLOBE NEWSWIRE) -- Akero Therapeutics, Inc. (Nasdaq: AKRO), a clinical-stage company developing transformational treatments for patients with serious metabolic disease marked by high unmet medical need, announced today the closing of its previously announced underwritten public offering of (i) 6,427,170 shares of its common stock at a public offering price of $48.00 per share, which includes the exercise in full by the underwriters of their option to purchase up to an additional 1,093,750 shares of common stock, and (ii) in lieu of common stock to certain investors, pre-funded warrants to purchase 1,958,247 shares of common stock at a public offering price of $47.9999 per pre-funded warrant, which represents the per share public offering price of each share of common stock less the $0.0001 per share exercise price for each pre-funded warrant. All of the shares of common stock and pre-funded warrants in the offering were sold by Akero. The gross proceeds from the offering, before deducting underwriting discounts and commissions and estimated offering expenses, were approximately $402.5 million.

J.P. Morgan, Morgan Stanley, and Jefferies acted as joint book-running managers for the offering. UBS Investment Bank acted as co-manager for the offering.

The securities were offered by Akero pursuant to an automatically effective shelf registration statement that was previously filed with the U.S. Securities and Exchange Commission (SEC). A final prospectus supplement and accompanying prospectus relating to and describing the terms of the offering was filed with the SEC on January 29, 2025. The final prospectus supplement and accompanying prospectus relating to the offering may be obtained from: J.P. Morgan Securities LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, by telephone at (866) 803-9204, or by email at prospectus-eq_fi@jpmchase.com; Morgan Stanley & Co. LLC, Attention: Prospectus Department, 180 Varick Street, 2nd Floor, New York, NY 10014, or by email at prospectus@morganstanley.com; or Jefferies LLC, Attention: Equity Syndicate Prospectus Department, 520 Madison Avenue, New York, NY 10022, by telephone at (877) 821-7388, or by email at prospectus_department@jefferies.com; or by accessing the SEC’s website at www.sec.gov.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Akero Therapeutics

Akero Therapeutics is a clinical-stage company developing transformational treatments for patients with serious metabolic diseases marked by high unmet medical need, including metabolic dysfunction-associated steatohepatitis (MASH). Akero’s lead product candidate, efruxifermin (EFX), is currently being evaluated in three ongoing Phase 3 clinical studies: SYNCHRONY Histology in patients with pre-cirrhotic MASH (F2-F3 fibrosis), SYNCHRONY Outcomes in patients with compensated cirrhosis due to MASH, and SYNCHRONY Real-World in patients with MASH or MASLD (Metabolic Dysfunction Associated Steatotic Liver Disease). The Phase 3 SYNCHRONY program builds on the results of two Phase 2b clinical trials, the HARMONY study in patients with pre-cirrhotic MASH and the SYMMETRY study in patients with compensated cirrhosis due to MASH.

Investor Contact:
Christina Tartaglia
Precision AQ
212.362.1200
christina.tartaglia@precisionaq.com

Media Contact:
Peg Rusconi
Deerfield Group
617.910.6217
Peg.rusconi@deerfieldgroup.com

FAQ

How much did Akero Therapeutics (AKRO) raise in its January 2025 public offering?

Akero Therapeutics raised approximately $402.5 million in gross proceeds through its public offering of common stock and pre-funded warrants.

What was the price per share for AKRO's January 2025 public offering?

The public offering price was $48.00 per share of common stock, and $47.9999 for pre-funded warrants.

How many shares did AKRO issue in its January 2025 public offering?

Akero issued 6,427,170 shares of common stock and pre-funded warrants to purchase 1,958,247 shares.

Did the underwriters exercise their option in AKRO's January 2025 offering?

Yes, the underwriters exercised their option in full to purchase an additional 1,093,750 shares of common stock.

Who were the underwriters for AKRO's January 2025 public offering?

J.P. Morgan, Morgan Stanley, and Jefferies acted as joint book-running managers, with UBS Investment Bank as co-manager.