Singular Genomics Receives Non-Binding Acquisition Proposal from Deerfield

Rhea-AI Summary

Singular Genomics Systems (Nasdaq: OMIC) has received a non-binding acquisition proposal from Deerfield Management Company and affiliated funds. The offer is to acquire all outstanding shares not already owned by Deerfield for $10.00 per share in cash. Deerfield, an existing stockholder, plans to invite other major stockholders and management to rollover their shares into the new company.

A special committee of independent directors, previously formed to evaluate strategic alternatives, will consider this proposal. The company emphasizes that there's no assurance of any transaction being consummated. TD Cowen is serving as the financial advisor to the special committee, with legal advisors also appointed.

Positive

• Potential acquisition offer at $10.00 per share in cash, providing a clear valuation
• Existing stockholder (Deerfield) showing confidence in the company through acquisition proposal
• Special committee already in place to evaluate strategic alternatives, including this proposal

Negative

• Non-binding nature of the proposal introduces uncertainty
• Potential loss of independence for Singular Genomics if acquired
• Possible shareholder concerns about the fairness of the $10.00 per share offer

Insights

Financial Analyst

Deerfield's non-binding proposal to acquire Singular Genomics at $10.00 per share represents a significant development. The offer price implies a premium of approximately 67% over the company's closing price of $5.99 on September 11, 2024. This substantial premium suggests Deerfield sees untapped value in Singular Genomics' NGS and spatial multiomics technologies. However, investors should note that this is a non-binding proposal and there's no guarantee of a deal. The formation of a Special Committee to evaluate strategic alternatives indicates the board is open to exploring options, which could potentially lead to a competitive bidding process. The involvement of major stockholders and existing management in the proposed transaction structure adds an interesting dynamic, potentially aligning interests but also raising questions about valuation fairness for minority shareholders.

Biotech Industry Expert

Deerfield's interest in acquiring Singular Genomics highlights the growing importance of next-generation sequencing and spatial multiomics in the biotech landscape. These technologies are important for advancing personalized medicine and drug discovery. Singular Genomics' platforms likely offer unique capabilities that Deerfield believes can be better leveraged under private ownership. This move could potentially accelerate the development and commercialization of Singular's technologies. However, it's worth considering whether $10.00 per share fully values the long-term potential of Singular's innovations. The biotech M&A market has been heating up and this proposal could spark interest from other potential acquirers in the genomics space, possibly leading to a more competitive valuation for Singular Genomics.

Corporate Governance Specialist

The formation of a Special Committee of independent directors to evaluate strategic alternatives, including Deerfield's proposal, is a important step in ensuring shareholder interests are protected. This committee, supported by independent financial and legal advisors, will be tasked with thoroughly assessing the offer and exploring other potential options. The involvement of TD Cowen as financial advisor adds credibility to the process. However, the proposal's structure, inviting major stockholders and management to roll over their shares, raises potential conflicts of interest that the Special Committee must carefully navigate. Transparency will be key and shareholders should closely monitor any further disclosures. The committee's decision-making process and ultimate recommendation will be critical in determining whether this deal truly maximizes value for all shareholders.

SAN DIEGO, Sept. 12, 2024 (GLOBE NEWSWIRE) -- Singular Genomics Systems, Inc. (Nasdaq: OMIC), a company leveraging novel next-generation sequencing (NGS) and spatial multiomics technologies to empower researchers and clinicians, announced today that it has received a non-binding proposal from Deerfield Management Company, L.P. and certain affiliated funds (collectively, “Deerfield”), to acquire all of the Company’s outstanding shares of common stock that are not already owned by Deerfield for $10.00 per share in cash. Deerfield, an existing stockholder of the Company, indicated in its letter that it intends to invite other major stockholders and existing management to rollover their shares of common stock into the new company.

The Company’s board of directors previously formed a special committee of independent directors (the “Special Committee”) to evaluate and consider the Company’s strategic alternatives, which would include the proposal submitted by Deerfield.

There can be no assurance that any transaction will be consummated, whether involving Deerfield or any other party. The Company and the Special Committee do not intend to comment further about Deerfield’s proposal unless and until the Special Committee deems further disclosure is appropriate.

A copy of Deerfield’s proposal letter delivered to the Special Committee on September 5, 2024 is available as an exhibit to Deerfield’s statement of beneficial ownership on Schedule 13D, as publicly filed on Thursday, September 12, 2024, with the United States Securities and Exchange Commission.

ADVISORS

TD Cowen is serving as financial advisor to the Special Committee, Richards, Layton & Finger, P.A. is serving as the Special Committee’s outside legal advisor and Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP is serving as legal advisor to the Company.

About Singular Genomics Systems, Inc.

Singular Genomics is a life science technology company that develops next-generation sequencing and multiomics technologies. The commercially available G4^® Sequencing Platform is a powerful, highly versatile benchtop genomic sequencer designed to produce fast and accurate results. In addition, the Company is currently developing the G4X™ Spatial Sequencer, which will leverage its proprietary sequencing technology, applying it as an in situ readout for transcriptomics, proteomics and fluorescent H&E in tissue, with spatial context and on the same platform as the G4. Singular Genomics’ mission is to empower researchers and clinicians to advance science and medicine. Visit www.singulargenomics.com for more information.

Forward-looking Statements

Certain statements contained in this press release, other than historical information, constitute forward-looking statements within the meaning of the federal securities laws. In some cases, forward-looking statements can be identified by terms such as “anticipates,” “believes,” “could,” “estimates,” “expects,” “foresees,” “forecasts,” “guidance,” “intends” “goals,” “may,” “might,” “outlook,” “plans,” “potential,” “predicts,” “projects,” “seeks,” “should,” “targets,” “will,” “would” or similar expressions and the negatives of those terms. These forward-looking statements are subject to risks, uncertainties, and assumptions. If the risks materialize or assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. Further information on these and additional risks that could affect Singular Genomics’ results is included in its filings with the Securities and Exchange Commission (“SEC”), including its most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q, and future reports that Singular Genomics may file with the SEC from time to time, which could cause actual results to vary from expectations. Any forward-looking statement made by Singular Genomics in this press release speaks only as of the day on which Singular Genomics makes it. Singular Genomics assumes no obligation to, and does not currently intend to, update any such forward-looking statements after the date of this release.

Investor Contact
Philip Trip Taylor
Gilmartin Group
ir@singulargenomics.com 

Media Contact
Matt Browning
pr@singulargenomics.com

FAQ

What is the acquisition offer for Singular Genomics (OMIC) stock?

Deerfield Management has proposed to acquire all outstanding shares of Singular Genomics (OMIC) not already owned by them for $10.00 per share in cash.

Is the acquisition of Singular Genomics (OMIC) by Deerfield confirmed?

No, the acquisition is not confirmed. It's a non-binding proposal that will be evaluated by a special committee of independent directors. There's no assurance that any transaction will be consummated.

Who is advising Singular Genomics (OMIC) on the potential acquisition?

TD Cowen is serving as the financial advisor to the special committee. Richards, Layton & Finger, P.A. is the special committee's legal advisor, while Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP is advising the company.

What happens to existing Singular Genomics (OMIC) shareholders if the acquisition proceeds?

Deerfield intends to invite major stockholders and existing management to rollover their shares into the new company. Other shareholders would receive $10.00 per share in cash if the deal proceeds as proposed.