AveXis, Inc. (NASDAQ:AVXS) announced today that it has entered into
an agreement and plan of merger with Novartis pursuant to which
Novartis will acquire AveXis for $218 per share or a total of $8.7
billion in cash. This offer represents a premium of 88 percent to
AveXis’ closing price on April 6, 2018, and a 72 percent premium to
the company's 30-day volume-weighted average stock price. The
transaction was unanimously approved by the Boards of Directors of
both companies.
“The commitment, drive and expertise of the entire AveXis team
has created significant stockholder value, and we are pleased that
Novartis recognizes that value in the potential of AVXS-101, our
first in class manufacturing capabilities and our gene therapy
pipeline, all of which serve to transform the lives of people
devastated by rare and life threatening neurological diseases such
as SMA, Rett syndrome and genetic ALS,” said Sean Nolan,
President and Chief Executive Officer of AveXis. “With
worldwide reach and extensive resources, Novartis should expedite
our shared vision of bringing gene therapy to these patient
communities across the globe as quickly and safely as
possible.”
Novartis plans a smooth transition of AveXis operations and the
integration of AveXis’ talented and dedicated employees into the
Novartis organization to continue the mission of bringing AVXS-101
to patients worldwide.
Completion of the transaction is expected in mid-2018, pending
the successful completion of the tender offer and all other closing
conditions. Until that time, AveXis will continue to operate as a
separate and independent company.
AveXis’ financial advisors are Goldman Sachs & Co. LLC and
Centerview Partners LLC, and Cravath, Swaine and Moore LLP and
Cooley LLP are acting as legal counsel for AveXis.
Transaction DetailsUnder the terms of the
agreement and plan of merger, Novartis has formed an acquisition
subsidiary, Novartis AM Merger Corporation (“Purchaser”), that will
commence a tender offer no later than April 17, 2018, to purchase
all outstanding shares of AveXis for $218 per share in cash and
AveXis will file a recommendation statement containing the
unanimous recommendation of the AveXis board that AveXis
stockholders tender their shares to Novartis. Following the
completion of the tender offer, Novartis expects to promptly
consummate a merger of Purchaser and AveXis in which shares of
AveXis that have not been purchased in the tender offer will be
converted into the right to receive the same cash price per share
as paid in the tender offer (other than shares held by stockholders
who properly demand and perfect appraisal rights under Delaware
law).
The tender offer and the merger are subject to customary closing
conditions, including the tender of at least a majority of
outstanding AveXis shares on a fully diluted
basis and the expiration or termination of the waiting period
under the Hart-Scott-Rodino Antitrust Improvements Act. The
merger agreement includes customary termination provisions for both
AveXis and Novartis, including a right for either party to
terminate if the transactions have not been completed by July 6,
2018 (such date, the “Outside Date”). Novartis is permitted
under specified antitrust related circumstances to extend the
Outside Date to October 6, 2018. If Novartis elects to extend
the Outside Date, the offer price will increase from $218 per share
to $225 per share in cash.
The merger agreement provides that, in connection with the
termination of the merger agreement under specified circumstances,
including termination by AveXis to accept a superior proposal,
AveXis will be required to pay to Novartis a fee equal to $284
million. The merger agreement also provides that, in
connection with the termination of the merger agreement under
specified antitrust related circumstances, Novartis will be
required to pay to AveXis a “reverse termination fee” equal to $437
million, which fee increases in the event Novartis elects to extend
the Outside Date in accordance with the terms of the merger
agreement.
About AveXis, Inc.AveXis, Inc. is a
clinical-stage gene therapy company, dedicated to developing and
commercializing novel treatments for patients suffering from rare
and life-threatening neurological genetic diseases. Our initial
product candidate, AVXS-101, is our proprietary gene therapy
currently in development for the treatment of spinal muscular
atrophy, or SMA, Type 1, the leading genetic cause of infant
mortality, and SMA Types 2 and 3. The U.S. Food and Drug
Administration, or FDA, has granted AVXS-101 Orphan Drug
Designation for the treatment of all types of SMA and Breakthrough
Therapy Designation, as well as Fast Track Designation for the
treatment of SMA Type 1. In addition to developing AVXS-101 to
treat SMA, we also plan to develop other novel treatments for rare
neurological diseases, including Rett syndrome and a genetic form
of amyotrophic lateral sclerosis caused by mutations in the
superoxide dismutase 1 (SOD1) gene.
For additional information, please visit www.avexis.com.
IMPORTANT INFORMATIONThe tender offer for the
shares of outstanding common stock of AveXis has not yet
commenced. This communication is for informational purposes
only and does not constitute an offer to buy or a solicitation of
an offer to sell any securities of AveXis. The solicitation
and offer to buy common stock of AveXis will only be made pursuant
to an Offer to Purchase and related materials. At the time
the tender offer is commenced, Novartis AG and Novartis AM Merger
Corporation will file a tender offer statement on Schedule TO with
the United States Securities and Exchange Commission (the “SEC”)
and thereafter AveXis will file a Solicitation/Recommendation
Statement on Schedule 14D-9 with the SEC with respect to the tender
offer. INVESTORS ARE ADVISED TO READ THE SCHEDULE TO AND THE
SCHEDULE 14D-9, AS EACH MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO
TIME, AS WELL AS ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC,
WHEN THEY BECOME AVAILABLE CAREFULLY AND IN THEIR ENTIRETY PRIOR TO
MAKING ANY DECISIONS WITH RESPECT TO THE TENDER OFFER OR WHETHER TO
TENDER THEIR SHARES PURSUANT TO THE TENDER OFFER, BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION
(INCLUDING THE TERMS AND CONDITIONS OF THE TENDER OFFER) AND THE
PARTIES THERETO. Investors may obtain a free copy of the
Solicitation/Recommendation Statement and other documents (when
available) that AveXis files with the SEC at the SEC’s website at
www.sec.gov, or free of charge from AveXis at www.AveXis.com or by
directing a request to AveXis at jgoff@avexis.com.
Cautionary Statement Regarding Forward-Looking
StatementsThis communication contains forward-looking
statements, within the meaning of the Private Securities Litigation
Reform Act of 1995, that involve substantial risks and
uncertainties, including statements regarding the completion of the
transaction with Novartis. In some cases, you can identify
forward-looking statements by terms such as “may,” “will,”
“should,” “expect,” “plan,” “anticipate,” “could,” “intend,”
“target,” “project,” “believe,” “estimate,” “predict,” “potential”
or “continue” or the negative of these terms or other similar
expressions intended to identify statements about the future. These
statements speak only as of the date of this communication and
involve known and unknown risks, uncertainties and other important
factors that may cause our actual results, performance or
achievements to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking statements. We have based these forward-looking
statements largely on our current expectations and projections
about future events and financial trends that we believe may affect
our business, financial condition and results of operations.
Meaningful factors which could cause actual results to differ from
these forward-looking statements include, without limitation:
(i) uncertainties as to the timing of the tender offer and the
subsequent merger; (ii) the risk that the tender offer or the
subsequent merger may not be completed in a timely manner or at
all; (iii) uncertainties as to the percentage of AveXis’
stockholders tendering their shares in the tender offer; (iv) the
possibility that competing offers or acquisition proposals for
AveXis will be made; (v) the possibility that any or all of the
various conditions to the consummation of the tender offer or the
subsequent merger may not be satisfied or waived, including the
failure to receive any required regulatory approvals from any
applicable governmental entities (or any conditions, limitations or
restrictions placed on such approvals); (vi) the occurrence of any
event, change or other circumstance that could give rise to the
termination of the merger agreement dated April 6, 2018 (the
“Merger Agreement”), among Novartis, Novartis AM Merger Corporation
and AveXis, including in circumstances which would require AveXis
to pay a termination fee; (vii) the effect of the announcement or
pendency of the transactions contemplated by the Merger Agreement
on AveXis’ ability to retain and hire key personnel, its ability to
maintain relationships with its customers, suppliers and others
with whom it does business, or its operating results and business
generally; (viii) risks related to diverting management’s attention
from AveXis’ ongoing business operations; (ix) the risk that
stockholder litigation in connection with the transactions
contemplated by the Merger Agreement may result in significant
costs of defense, indemnification and liability; and (x) other
factors discussed in the “Risk Factors” and the “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations” sections of AveXis’ Annual Report on Form 10-K for the
year ended December 31, 2017, filed with the SEC on February 28,
2018, and risks that may be described in Quarterly Reports on Form
10-Q, Current Reports on Form 8-K and other filings by AveXis with
the SEC. In addition to the risks described above, other unknown or
unpredictable factors also could affect AveXis’ results. As a
result of these factors, we cannot assure you that the
forward-looking statements in this communication will prove to be
accurate. Furthermore, if our forward-looking statements prove to
be inaccurate, the inaccuracy may be material. In light of the
significant uncertainties in these forward-looking statements, you
should not regard these statements as a representation or warranty
by us or any other person that we will achieve our objectives and
plans in any specified time frame, or at all. The forward-looking
statements in this communication represent our views as of the date
of this communication. We anticipate that subsequent events and
developments may cause our views to change. However, while we may
elect to update these forward-looking statements at some point in
the future, we undertake no obligation to publicly update any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by law. You should,
therefore, not rely on these forward-looking statements as
representing our views as of any date subsequent to the date of
this communication. You should read this communication and the
documents that we reference in this communication completely and
with the understanding that our actual future results may be
materially different from what we expect. We qualify all of our
forward-looking statements by these cautionary statements.
Media Inquiries:Lauren BarbieroW2O
Group646-564-2156lbarbiero@w2ogroup.com
Investor Inquiries:Jim GoffAveXis,
Inc.650-862-4134jgoff@avexis.com
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