Highlights Expected Special Cash Dividend of
Approximately $70 Million, and Upside of CVR and Ownership of
Combined Company
Sesen Bio, Inc. (Nasdaq: SESN) today issued the following
statement reiterating the Company’s confidence in, and commitment
to, the pending merger with Carisma Therapeutics Inc. (Carisma) as
the best path forward for stockholders.
The Sesen Bio Board of Directors remains confident that the
pending merger with Carisma represents the most value maximizing
path forward.
The Board, in consultation with its financial and legal
advisors, undertook a four-month comprehensive review of strategic
alternatives, including evaluating a merger, sale of assets,
resumption of R&D and liquidation of assets and dissolution.
After reaching out to over 100 companies and evaluating 42 bids,
the Board unanimously determined the pending merger with Carisma
was the most value maximizing option for all stockholders,
delivering an implied total of $0.88 per share1, that could
otherwise not be achieved.
The Company believes the proposed alternative from Bradley
Radoff and Michael Torok and their affiliates (collectively, the
“Investor Group”) hinges on an unfeasible distribution scenario
with inaccurate assumptions that would leave considerable
stockholder value on the table. Aside from the significant
uncertainty and risk this proposed scenario would introduce, it
does not consider contingent liabilities to the Company which may
be sizable. As a more realistic alternative, in an orderly
liquidation or dissolution scenario – which would come with
significant expense, delay and uncertainty – only approximately
60%-90%2, or approximately $0.40-$0.60 per share, of the cash
balance is estimated to be available for an initial distribution to
stockholders, which could take up to six months or more after an
additional stockholder vote. The remaining amount would fund the
wind-down of operations and the reserves for current, potential
future and unknown liabilities, which could take up to three years
to fully settle.
The pending merger with Carisma delivers significant and
immediate value to stockholders.
Following extensive engagement with stockholders, Sesen Bio
recently amended the merger agreement to deliver even greater value
in connection with closing:
- Expected special cash dividend of approximately $70 million to
be paid at closing, or approximately $0.34 per share, an increase
from the previously stated special cash dividend of up to $25
million;
- 25.2% ownership interest in the $357 million combined company,
or $0.40 per share. Carisma is a well-funded company developing
groundbreaking therapies for a wide range of cancers with potential
for significant long-term upside; and
- $30 million contingent value right (“CVR”)3, or $0.14 per
share, related to the Roche Asset Purchase Agreement, which has
been amended to also include upside for potential proceeds from any
sale of Sesen Bio’s legacy assets (Vicineum and/or its preclinical
assets).
The pending merger with Carisma provides immediate cash value
for Sesen Bio stockholders and additional upside through ownership
in the combined company, which the Company believes is far superior
to the risk, uncertainty and prolonged timeline associated with
other potential strategic alternatives, including a dissolution and
liquidation of Sesen Bio.
The Investor Group is ignoring key provisions in the amended
merger agreement.
The Investor Group seems to deliberately ignore several
provisions of the amended merger agreement:
- The CVR payable to Sesen Bio stockholders includes all of the
Company’s legacy assets, including Vicineum; and
- The Board requested and received an updated fairness opinion
from its financial advisor, SVB Securities LLC. The amendment to
the merger agreement filed as an exhibit to Sesen Bio’s Form 8-K
filed on December 29, 2022 clearly states that the Board received
an opinion “to the effect that, as of the date of this First
Amendment and subject to the assumptions, qualifications,
limitations and other matters set forth therein, the Exchange Ratio
is fair, from a financial point of view, to [Sesen Bio].”
The combined company provides significant near-, medium- and
long-term opportunities, and will be led by a management team with
strong investor support.
The Sesen Bio Board of Directors continues to believe the
pending merger will provide significant value to Sesen Bio
stockholders given Carisma's clinical-stage proprietary CAR-M
platform that could transform treatment for patients with cancer
and other serious disorders.
- Carisma’s technology is believed to have the only demonstrated
proof of mechanism and safety data in CAR-M therapy through human
clinical trials;
- CAR-M technology has broad applicability across multiple types
of solid tumors and has attracted meaningful strategic partnerships
with leading biotechnology and pharmaceutical companies including
Moderna, Novartis, AbbVie and Merck;
- Carisma’s strategic collaboration with Moderna will fully fund
R&D of innovative cancer therapies and provides potentially
significant downstream economics in the form of development,
regulatory and commercial milestones, in addition to royalty
payments; and
- Carisma has several upcoming value inflection milestones over
the next 18 months, including multiple clinical data readouts, the
first of which is expected in mid-2023.
Following completion of the pending merger, the combined company
will be led by Carisma’s management team, including Chief Executive
Officer, Steven Kelly, and co-founder and Chief Scientific Officer,
Dr. Michael Klichinsky who is the co-inventor of the technology at
the University of Pennsylvania. This team has strong investor
support, comprising of leaders within biotech, including AbbVie,
Moderna, Wellington and TPG.
Sesen Bio is open to dialogue with all of its stockholders, as
evidenced by the recently amended merger agreement. The Company’s
actions reflect its focus on serving the best interests of all
Sesen Bio stockholders.
SVB Securities is acting as exclusive financial advisor to Sesen
Bio and Hogan Lovells US LLP is serving as its legal counsel.
About Sesen Bio
Sesen Bio, Inc. is a late-stage clinical company focused on
targeted fusion protein therapeutics for the treatment of patients
with cancer. Sesen Bio’s most advanced product candidate,
Vicineum™, also known as VB4-845, is a locally-administered
targeted fusion protein composed of an anti-epithelial cell
adhesion molecule antibody fragment tethered to a truncated form of
Pseudomonas exotoxin A for the treatment of non-muscle invasive
bladder cancer. On July 15, 2022, Sesen Bio made the strategic
decision to voluntarily pause further development of Vicineum in
the US. The decision was based on a thorough reassessment of
Vicineum, which included the incremental development timeline and
associated costs for an additional Phase 3 clinical trial,
following Sesen Bio’s discussions with the United States Food and
Drug Administration. Sesen Bio has turned its primary focus to
assessing potential strategic alternatives with the goal of
maximizing stockholder value. Additionally, Sesen Bio is seeking a
partner for the further development of Vicineum. For more
information, please visit the Company’s website at
www.sesenbio.com.
Cautionary Note on Forward-Looking
Statements
Any statements in this press release about future expectations,
plans and prospects for Sesen Bio, Inc. (Sesen Bio), CARISMA
Therapeutics Inc. (Carisma) or the combined company, Sesen Bio’s,
Carisma’s or the combined company’s strategy or future operations,
and other statements containing the words “anticipate,” “believe,”
“contemplate,” “expect,” “intend,” “may,” “plan,” “predict,”
“target,” “potential,” “possible,” “will,” “would,” “could,”
“should,” “continue,” and similar expressions, constitute
forward-looking statements within the meaning of The Private
Securities Litigation Reform Act of 1995. For example, statements
concerning the proposed transaction, the concurrent financing, the
contingent value rights and other matters, including without
limitation: statements relating to the satisfaction of the
conditions to and consummation of the proposed transaction, the
expected timing of the consummation of the proposed transaction and
the expected ownership percentages of the combined company, Sesen
Bio’s and Carisma’s respective businesses, the strategy of the
combined company, future operations, advancement of the combined
company’s product candidates and product pipeline, clinical
development of the combined company’s product candidates, including
expectations regarding timing of initiation and results of clinical
trials of the combined company, the ability of Sesen Bio to remain
listed on the Nasdaq Stock Market, the completion of the concurrent
financing, the receipt of any payments under the contingent value
rights, and the amount and timing of distributions made to Sesen
Bio’s stockholders, if any, in connection with any potential
dissolution or liquidation scenario are forward-looking statements.
Actual results may differ materially from those indicated by such
forward-looking statements as a result of various important
factors, including without limitation: (i) the risk that the
conditions to the closing of the proposed transaction are not
satisfied, including the failure to obtain stockholder approval of
matters related to the proposed transaction in a timely manner or
at all; (ii) uncertainties as to the timing of the consummation of
the proposed transaction and the ability of each of Sesen Bio and
Carisma to consummate the proposed transaction, including
completing the concurrent financing; (iii) risks related to Sesen
Bio’s ability to correctly estimate its expected net cash at
closing and Sesen Bio’s and Carisma’s ability to correctly estimate
and manage their respective operating expenses and expenses
associated with the proposed transaction; (iv) risks related to
Sesen Bio’s continued listing on the Nasdaq Stock Market until
closing of the proposed transaction; (v) the risk that as a result
of adjustments to the exchange ratio, Sesen Bio stockholders or
Carisma stockholders could own less of the combined company than is
currently anticipated; (vi) the risk that the conditions to payment
under the contingent value rights will not be met and that the
contingent value rights may otherwise never deliver any value to
Sesen Bio stockholders; (vii) risks associated with the possible
failure to realize certain anticipated benefits of the proposed
transaction, including with respect to future financial and
operating results; (viii) uncertainties regarding the impact any
delay in the closing would have on the anticipated cash resources
of the combined company upon closing and other events and
unanticipated spending and costs that could reduce the combined
company’s cash resources; (ix) the effect of uncertainties related
to the actions of activist stockholders, which could make it more
difficult to obtain the approval of Sesen Bio stockholders with
respect to the transaction related proposals and result in Sesen
Bio incurring significant fees and other expenses, including for
third-party advisors; (x) the occurrence of any event, change or
other circumstance or condition that could give rise to the
termination of the merger agreement; (xi) the effect of the
announcement, pendency or completion of the merger on Sesen Bio’s
or Carisma’s business relationships, operating results and business
generally; (xii) costs related to the merger; (xiii) the outcome of
any legal proceedings that may be instituted against Sesen Bio,
Carisma or any of their respective directors or officers related to
the merger agreement or the transactions contemplated thereby;
(xiv) the ability of Sesen Bio or Carisma to protect their
respective intellectual property rights; (xv) competitive responses
to the proposed transaction and changes in expected or existing
competition; (xvi) the success and timing of regulatory submissions
and pre-clinical and clinical trials; (xvii) regulatory
requirements or developments; (xviii) changes to clinical trial
designs and regulatory pathways; (xix) changes in capital resource
requirements; (xx) risks related to the inability of the combined
company to obtain sufficient additional capital to continue to
advance its product candidates and its preclinical programs; (xxi)
legislative, regulatory, political and economic developments; and
(xxii) other factors discussed in the “Risk Factors” section of
Sesen Bio’s Annual Report on Form 10-K, Quarterly Reports on Form
10-Q and other reports filed with the Securities Exchange
Commission (SEC). In addition, the forward-looking statements
included in this communication represent Sesen Bio’s and Carisma’s
views as of the date hereof. Sesen Bio and Carisma anticipate that
subsequent events and developments will cause the respective
company’s views to change. However, while Sesen Bio may elect to
update these forward-looking statements at some point in the
future, Sesen Bio specifically disclaims any obligation to do so,
except as required under applicable law. These forward-looking
statements should not be relied upon as representing Sesen Bio’s
views as of any date subsequent to the date hereof.
Important Additional
Information
In connection with the proposed transaction between Carisma and
Sesen Bio, Sesen Bio filed with the SEC a registration statement on
Form S-4 on October 14, 2022, Amendment No. 1 to the Form S-4 on
November 21, 2022 and Amendment No. 2 to the Form S-4 on December
14, 2022 (as amended, the Form S-4). The Form S-4 includes a
preliminary proxy statement of Sesen Bio and constitutes a
prospectus of Sesen Bio with respect to shares of Sesen Bio common
stock to be issued in the proposed transaction (preliminary proxy
statement/prospectus). The preliminary proxy statement/prospectus
is not final and may be further amended. The definitive proxy
statement/prospectus (if and when available) will be delivered to
Sesen Bio’s stockholders. Sesen Bio may also file other relevant
documents regarding the proposed transaction with the SEC.
INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THESE MATERIALS,
INCLUDING THE REGISTRATION STATEMENT, THE DEFINITIVE PROXY
STATEMENT/PROSPECTUS, AND ALL OTHER RELEVANT DOCUMENTS THAT ARE OR
WILL BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED
TRANSACTION, INCLUDING ANY AMENDMENTS OR SUPPLEMENTS TO THESE
MATERIALS, BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION AND THE PARTIES TO THE
PROPOSED TRANSACTION. Investors and security holders are able to
obtain the preliminary proxy statement/prospectus, the definitive
proxy statement/prospectus (if and when available) and other
documents that are filed or will be filed by Sesen Bio with the SEC
free of charge from the SEC’s website at www.sec.gov or from Sesen
Bio at the SEC Filings section of www.sesenbio.com.
No Offer or Solicitation
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities
Act of 1933, as amended. Subject to certain exceptions to be
approved by the relevant regulators or certain facts to be
ascertained, a public offer will not be made directly or
indirectly, in or into any jurisdiction where to do so would
constitute a violation of the laws of such jurisdiction, or by use
of the mails or by any means or instrumentality (including without
limitation, facsimile transmission, telephone or internet) of
interstate or foreign commerce, or any facility of a national
securities exchange, of any such jurisdiction.
Participants in the
Solicitation
Sesen Bio and Carisma Therapeutics and their respective
directors, executive officers and other members of management may
be deemed to be participants in the solicitation of proxies in
respect of the proposed transaction. Information about Sesen Bio’s
directors and executive officers is available in Sesen Bio’s Annual
Report on Form 10-K for the fiscal year ended December 31, 2021,
its definitive proxy statement dated April 28, 2022 for its 2022
Annual Meeting of Stockholders and its Current Report on Form 8-K
filed with the SEC on August 31, 2022. Other information regarding
the participants in the proxy solicitation and a description of
their interests in the proposed transaction, by security holdings
or otherwise, is included in the preliminary proxy
statement/prospectus and other relevant materials that are or will
be filed with the SEC regarding the proposed transaction. Investors
should read the definitive proxy statement/prospectus carefully (if
and when available) before making any voting or investment
decisions. You may obtain free copies of these documents from Sesen
Bio or the SEC’s website as indicated above.
1 Amounts reflect potential payments in the future and have not
been discounted.
2 Based on precedent liquidation processes and company
projections of potential liabilities and operating expenses.
3 Amounts reflect potential payments in the future and have not
been discounted.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230104005422/en/
Investors: Erin Clark, Vice President, Corporate Strategy &
Investor Relations ir@sesenbio.com
Grafico Azioni Sesen Bio (NASDAQ:SESN)
Storico
Da Ago 2024 a Set 2024
Grafico Azioni Sesen Bio (NASDAQ:SESN)
Storico
Da Set 2023 a Set 2024