NGM Bio Announces Closing of Tender Offer
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Insights
The completion of NGM Biopharmaceuticals' tender offer by Atlas Neon Parent, Inc. represents a significant event in the biotechnology industry, particularly for the involved parties. The acquisition price of $1.55 per share needs to be evaluated against the historical stock performance and industry benchmarks. The fact that 27% of NGM Bio's outstanding shares were tendered suggests a level of investor confidence in the offer's fairness. However, one must consider the broader impact, such as the potential for reduced liquidity for remaining shareholders and implications for the company's strategic direction post-acquisition.
With the company going private, investors should analyze the potential benefits, like increased operational flexibility and freedom from public reporting requirements, against the loss of public market valuation mechanisms. This shift also typically leads to changes in the governance structure that may affect the company's long-term strategy and innovation pipeline. The delisting from Nasdaq is a definitive endpoint for public investors and the timing of these actions relative to market conditions could be insightful for understanding the acquisition strategy.
NGM Bio's acquisition is indicative of ongoing consolidation trends within the biotech sector. Given the high costs and risks associated with drug development, mergers and acquisitions can provide a means for larger entities to bolster their pipelines and for smaller firms to secure the necessary capital to continue their research. It's important to assess the therapeutic areas NGM Bio specializes in and the stage of their product pipeline to understand the strategic value of the acquisition.
Market reaction to such acquisitions can vary, but typically, an acquisition announcement can lead to increased volatility in the stock prices of both the acquiring and target companies. In this case, the cessation of trading on Nasdaq following the merger will bring an end to such volatility for NGM Bio. The broader impact on the biotech sector could involve a reassessment of valuations for similar companies, potentially affecting investor strategies and the market dynamics of biotech stocks.
From a legal perspective, the transaction's completion following the tender offer is subject to regulatory compliance and fulfillment of contractual conditions. The adherence to the Securities Exchange Act of 1934 for the delisting and deregistration process must be meticulously managed. Investors and stakeholders should be aware of the legal rights associated with the tender offer, such as the appraisal rights for dissenting shareholders.
The involvement of reputable legal advisors, such as Hogan Lovells US LLP for NGM Bio and Paul, Weiss, Rifkind, Wharton & Garrison LLP for Parent, indicates a thorough legal due diligence process. It's important for investors to understand the legal implications of the merger, including any potential changes in shareholder rights and the legal responsibilities of the newly private entity. The legal framework within which this acquisition has occurred can set precedents and influence future transactions within the biotech industry.
SAN FRANCISCO, April 05, 2024 (GLOBE NEWSWIRE) -- NGM Biopharmaceuticals, Inc. (“NGM Bio”) (Nasdaq: NGM), a biotechnology company focused on discovering and developing transformative therapeutics for patients, today announced that Atlas Neon Parent, Inc. (“Parent”), an affiliate of The Column Group, LP (“TCG”), through its wholly-owned subsidiary Atlas Neon Merger Sub, Inc. (“Merger Sub”), has successfully completed the previously announced cash tender offer to acquire all outstanding shares of NGM Bio not held by affiliates of TCG and certain other stockholders at a price per share of
The tender offer and related withdrawal rights expired at one minute after 11:59 p.m. Eastern Time on April 4, 2024 (the “Expiration Date”). As of the Expiration Date, a total of 22,323,295 shares of NGM Bio common stock were validly tendered, and not validly withdrawn, representing approximately
Following the closing of the tender offer, Merger Sub merged with and into NGM Bio and all shares of NGM Bio common stock that had not been validly tendered (other than shares held by stockholders who properly demanded appraisal of such shares or shares held by affiliates of TCG and certain other stockholders who agreed to exchange their shares for shares of Parent) were converted into the right to receive the Offer Price (the “Merger”). As a result of the Merger, NGM Bio became a privately held and wholly-owned subsidiary of Parent. Prior to the opening of trading on The Nasdaq Stock Market LLC (“Nasdaq”) on April 5, 2024, all shares of NGM Bio common stock ceased trading on Nasdaq, and NGM Bio intends promptly to cause such shares to be delisted from Nasdaq and deregistered under the Securities Exchange Act of 1934, as amended.
Advisors
Guggenheim Securities, LLC acted as exclusive financial advisor and Hogan Lovells US LLP acted as legal counsel to the special committee of the board of directors of NGM Bio. Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as legal counsel to Parent.
About NGM Biopharmaceuticals, Inc.
NGM Bio is focused on discovering and developing novel, life-changing medicines for people whose health and lives have been disrupted by disease. NGM Bio’s biology-centric drug discovery approach aims to seamlessly integrate interrogation of complex disease-associated biology and protein engineering expertise to unlock proprietary insights that are leveraged to generate promising product candidates and enable their rapid advancement into proof-of-concept studies. All therapeutic candidates in the NGM Bio pipeline have been generated by its in-house discovery engine, always led by biology and motivated by unmet patient need. Visit us at www.ngmbio.com for more information.
Cautionary Notice Regarding Forward-Looking Statements
Statements contained in this communication regarding matters that are not historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “expects,” “intends,” “focused” and similar expressions (as well as other words or expressions referencing future events, conditions or circumstances) are intended to identify forward-looking statements. Because such statements deal with future events and are based on NGM Bio’s current expectations, they are subject to various risks and uncertainties, and actual results, performance or achievements of NGM Bio could differ materially from those described in or implied by the statements in this communication. These forward-looking statements are subject to risks and uncertainties. Additional risks and uncertainties affecting NGM Bio and its development programs are set forth in the section titled “Risk Factors” in NGM Bio’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on March 11, 2024, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings and reports that NGM Bio makes from time to time with the SEC. Except as required by law, NGM Bio assumes no obligation to update these forward-looking statements, which speak only as of the date they are made, or to update the reasons if actual results differ materially from those anticipated in the forward-looking statements.
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FAQ
What is the acquisition price per share for NGM Biopharmaceuticals, Inc.?
Who acquired NGM Biopharmaceuticals, Inc.?
What percentage of outstanding shares were tendered during the cash tender offer?
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