Revolution Medicines Announces Commencement of Public Offering of Common Stock

Rhea-AI Summary

Revolution Medicines (Nasdaq: RVMD), a clinical-stage oncology company, has announced a public offering of common stock worth up to $600.0 million. The company plans to grant underwriters a 30-day option to purchase an additional $90.0 million of shares. J.P. Morgan, TD Cowen, Goldman Sachs & Co. and Guggenheim Securities will serve as joint book-running managers, with UBS Investment Bank as lead manager. The offering's completion depends on market conditions, with no guaranteed timeline or final terms.

Positive

• Potential to raise up to $690 million in total capital if all options are exercised
• Strong lineup of major financial institutions as underwriters

Negative

• Potential significant dilution for existing shareholders
• Stock offering subject to market conditions with no guarantee of completion

Insights

Financial Analyst

This $600 million common stock offering, with an additional $90 million option, represents a significant capital raise for Revolution Medicines. The timing aligns with their clinical-stage development needs in the competitive oncology space. Key considerations:

• The offering will dilute existing shareholders but strengthens the company's balance sheet for RAS-addicted cancer drug development
• Involvement of major underwriters like J.P. Morgan and Goldman Sachs suggests strong institutional interest
• The shelf registration was recently filed in March 2024, indicating strategic planning for this capital raise

The size of the offering relative to their $9.7 billion market cap suggests confidence in their pipeline and development programs.

REDWOOD CITY, Calif., Dec. 02, 2024 (GLOBE NEWSWIRE) -- Revolution Medicines, Inc. (Nasdaq: RVMD), a clinical-stage oncology company developing targeted therapies for patients with RAS-addicted cancers, today announced that it has commenced an underwritten public offering to sell up to $600.0 million of shares of its common stock. All of the shares of common stock are being offered by Revolution Medicines. In addition, Revolution Medicines intends to grant the underwriters a 30-day option to purchase up to an additional $90.0 million of shares of common stock. The offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering.

J.P. Morgan, TD Cowen, Goldman Sachs & Co. LLC and Guggenheim Securities are acting as joint book-running managers for the proposed offering. UBS Investment Bank is acting as lead manager.

A shelf registration statement relating to these securities was filed with the U.S. Securities and Exchange Commission (SEC) on March 4, 2024, and automatically became effective upon filing. This offering is being made solely by means of a prospectus. A copy of the preliminary prospectus supplement and the accompanying prospectus relating to this offering may be obtained for free by visiting EDGAR on the SEC’s website at www.sec.gov. Alternatively, a copy of the preliminary prospectus supplement and the accompanying prospectus relating to this offering may be obtained by contacting: J.P. Morgan Securities LLC, Attention: Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, New York 11717, by email at prospectus-eq_fi@jpmchase.com and postsalemanualrequests@broadridge.com; TD Securities (USA) LLC, 1 Vanderbilt Avenue, New York, New York 10017, by telephone at (855) 495-9846 or by email at TD.ECM_Prospectus@tdsecurities.com; Goldman Sachs & Co. LLC, Attention: Prospectus Department, 200 West Street, New York, NY 10282, by telephone at (866) 471-2526 or by email at prospectus-ny@ny.email.gs.com; and Guggenheim Securities, LLC, Attention: Equity Syndicate Department, 330 Madison Avenue, 8th Floor, New York, New York 10017, by telephone at (212) 518-9544 or by email at GSEquityProspectusDelivery@guggenheimpartners.com.

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

About Revolution Medicines, Inc.

Revolution Medicines is a clinical-stage oncology company developing novel targeted therapies for RAS-addicted cancers. The company’s R&D pipeline comprises RAS(ON) inhibitors designed to suppress diverse oncogenic variants of RAS proteins. The company’s RAS(ON) inhibitors RMC-6236, a RAS(ON) multi-selective inhibitor, RMC-6291, a RAS(ON) G12C-selective inhibitor, and RMC-9805, a RAS(ON) G12D-selective inhibitor, are currently in clinical development. Additional development opportunities in the company’s pipeline focus on RAS(ON) mutant-selective inhibitors, including RMC-5127 (G12V), RMC-0708 (Q61H) and RMC-8839 (G13C), in addition to RAS companion inhibitors RMC-4630 and RMC-5552.

Forward Looking Statements

To the extent that statements contained in this press release are not descriptions of historical facts regarding Revolution Medicines, they are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements regarding completion, timing and size of the proposed public offering. Such forward-looking statements involve risks and uncertainties, including, without limitation, risks and uncertainties related to market conditions and the satisfaction of closing conditions related to the proposed public offering. Such forward-looking statements involve substantial risks and uncertainties that relate to future events, and the actual results could differ significantly from those expressed or implied by the forward-looking statements. Revolution Medicines undertakes no obligation to update or revise any forward-looking statements. For a further description of the risks and uncertainties relating to Revolution Medicines’ business in general, see the preliminary prospectus supplement related to the proposed public offering and Revolution Medicines’ current and future reports filed with the SEC, including Revolution Medicines’ Quarterly Report on Form 10-Q for the quarter ended September 30, 2024, filed with the SEC on November 6, 2024.

FAQ

How much is Revolution Medicines (RVMD) planning to raise in their new stock offering?

Revolution Medicines is planning to raise up to $600.0 million through the public offering, with an additional $90.0 million option granted to underwriters, potentially totaling $690 million.

Who are the underwriters for RVMD's December 2024 public offering?

J.P. Morgan, TD Cowen, Goldman Sachs & Co. and Guggenheim Securities are acting as joint book-running managers, with UBS Investment Bank as lead manager.

What is the duration of the underwriters' option in RVMD's stock offering?

The underwriters have a 30-day option to purchase additional shares worth up to $90.0 million.