TIDMRTW
RNS Number : 3705A
RTW Biotech Opportunities Ltd
22 January 2024
LEI: 549300Q7EXQQH6KF7Z84
22nd January 2024
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED IN IT ARE NOT
FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART,
DIRECTLY OR INDIRECTLY, IN, INTO OR FROM, THE UNITED STATES OF
AMERICA (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF
THE UNITED STATES AND THE DISTRICT OF COLUMBIA), AUSTRALIA, CANADA,
JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE
TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR
REGULATIONS OF SUCH JURISDICTION.
THIS ANNOUNCEMENT IS NOT AN OFFER TO SELL, OR THE SOLICITATION
OF AN OFFER TO ACQUIRE, ANY SECURITIES IN THE UNITED STATES
(INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED
STATES, AND THE DISTRICT OF COLUMBIA) OR ANY OTHER JURISDICTION IN
WHICH ANY OFFER, SOLICITATION OR SALE OF SECURITIES WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE
SECURITIES LAWS OF ANY SUCH JURISDICTION. NO SECURITIES MAY BE
OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN
APPLICABLE EXEMPTION FROM REGISTRATION REQUIREMENTS. ANY PUBLIC
OFFERING OF SECURITIES TO BE MADE IN THE UNITED STATES WILL BE MADE
BY MEANS OF A PROSPECTUS THAT MAY BE OBTAINED FROM THE ISSUER (OR,
IF APPLICABLE, A SELLING SECURITY HOLDER) AND THAT WILL CONTAIN
DETAILED INFORMATION ABOUT THE COMPANY AND MANAGEMENT, AS WELL AS
FINANCIAL STATEMENTS. RTW BIOTECH OPPORTUNITIES LIMITED DOES NOT
INT TO MAKE ANY PUBLIC OFFERING OF SECURITIES IN THE UNITED STATES.
NEITHER THIS ANNOUNCEMENT NOR ANY PART OF IT SHALL FORM THE BASIS
OF OR BE RELIED ON IN CONNECTION WITH OR ACT AS AN INDUCEMENT TO
ENTER INTO ANY CONTRACT OR COMMITMENT WHATSOEVER.
RTW Biotech Opportunities Ltd ("RTW BIO" or the "Company")
Update on Arix Scheme and RTW BIO Capital Allocation
-- RTW BIO has completed the previously announced $57.1M
acquisition of a 25.5% stake in Arix , representing a purchase
price of GBP1.37 per Arix share
-- RTW BIO reaffirms the highly compelling transaction with Arix
that delivers immediate and long-term benefits for both RTW BIO and
Arix shareholders
-- RTW BIO's NAV has increased by 29.3% since the announcement
of the transaction on 1 November 2023 and currently delivers value
equivalent of GBP1.58 per Arix share
-- Arix's first general meeting is due to take place on 29
January 2024 and RTW BIO has undertaken to vote its 25.5% stake to
support the Arix Scheme, which has been recommended by the Arix
Special Committee
-- Two leading proxy advisory firms have published recommendations in favour of the Arix Scheme
-- RTW BIO to increase capital returns to shareholders to a
total of up to $30 million post completion of the Arix Scheme
London - 22 January 2024 - RTW BIO, a London Stock
Exchange-listed investment company focused on identifying
transformative assets with high growth potential across the
biopharmaceutical and medical technology sectors, has completed the
previously announced investment in Arix Bioscience plc ("Arix") to
support the previously announced all-share acquisition of Arix's
assets by RTW BIO, to be effected through a scheme of
reconstruction and the voluntary winding-up of Arix under section
110 of the Insolvency Act 1986 (the "Arix Scheme").
New Investment in Arix Bioscience
RTW BIO has acquired 33,023,210 Arix shares from Merton
Acquisition HoldCo LLC, a wholly owned subsidiary of Acacia
Research Corporation, representing a 25.5% interest in Arix (the
"Acacia Stake"). As previously agreed, the transaction was at a
fixed price of US$57,078,670.12 , which today represents an
equivalent purchase price of GBP1.37 per Arix share ( based on
USD:GBP foreign exchange rate of 0.7900 as at 17 January 2024) ,
with RTW BIO benefiting from the weakening dollar-pound exchange
rate since deal signing. The transaction was agreed and settled in
USD contingent upon receiving clearance from the FCA, which was
granted on 15 January 2024.
RTW BIO has undertaken to vote all 33,023,210 Arix shares in
favour of all resolutions in respect of the Arix Scheme,
representing a 25.5% interest of Arix shareholder registry.
Update on RTW BIO Performance
Since the Arix Scheme was announced on 1 November 2023, RTW
BIO's NAV has increased by 29.3% as of 31 December 2023. The RTW
BIO share price has also seen a meaningful increase since
announcement and, at the Arix Scheme's fixed exchange ratio of
1.4633 RTW BIO share per Arix share, the Arix Scheme currently
delivers value equivalent of GBP1.58 per Arix share, meaningfully
higher than the Arix share price of GBP1.35 (based on RTW BIO share
price of $1.37 and USD:GBP foreign exchange rate of 0.7900, all as
at 17 January 2024). This price represents a 61.6% premium to the
Arix unaffected price as of 12 July 2023, the day immediately prior
to Arix's announcement commencing a strategic review, and a 34.2%
premium to the closing Arix share price on 31 October 2023, the day
immediately prior to the announcement of the Arix Scheme. This is a
meaningful immediate economic opportunity for Arix shareholders in
addition to the announced long-term benefits of the transaction
that include:
-- RTW as a best-in-class manager with superior capabilities for Arix's assets
-- An enhanced return potential from deployment of Arix's capital
-- Immediate scale and complementary portfolio benefits
-- Compelling value creation today and in the future for all shareholders
-- Enhanced profile providing liquidity and re-rating opportunity
-- Unique opportunity to buy into a depressed market while innovation is booming
Update on the Arix Scheme
With RTW BIO completing the purchase of the Acacia Stake, after
receiving written confirmation from the FCA confirming that it has
approved the proposed change in control of Arix, Arix is expected
to publish the shareholder circular in due course to convene the
second general meeting in connection with the Scheme. Subject to
satisfaction (or, if applicable, waiver) of the conditions to the
Scheme, the Scheme is expected to become effective in Q1 2024.
Proxy Adviser Recommendations
RTW BIO is pleased to note that two leading independent proxy
adviser firms have each published proxy advisory reports
recommending that Arix shareholders vote in favour of the
resolution in respect of the Arix Scheme to be proposed at the
first general meeting.
Update on RTW BIO Capital Allocation
The Board of RTW BIO continues to believe that the discount to
NAV per Ordinary Share at which the Company's shares currently
trade materially undervalues the Company and its portfolio.
Therefore, given the increased scale that the Arix Scheme will
provide, the Board of RTW BIO intends to increase capital returns
to shareholders to a total of up to $30 million post completion of
the Arix Scheme. This total includes the previously announced share
buyback of up to $10 million, of which c.$2.8 million has already
been executed. The NAV-accretive share buyback will be implemented
over time at the Company's discretion. The Board believes that this
allocation clearly demonstrates its confidence in the outlook for
the biotech sector and the Company's portfolio and its capital
allocation discipline whilst also providing additional liquidity to
shareholders. On 31 December 2023, 12.9% of the Company's NAV was
held in "cash and other" and 20.4% was invested in the "other
public" segment of the portfolio, which is an invested liquidity
pool designed to mitigate the drag of setting aside cash for future
deployment.
Roderick Wong, M.D., Managing Partner and Chief Investment
Officer of RTW Investments, said:
"We remain excited to partner with Arix and combine our
complementary portfolios to capitalize on the tremendous
opportunities across the life sciences markets. Today's
announcement is an important milestone towards the overall
completion of the transaction and RTW BIO has undertaken to vote
its entire Arix shareholding to support the Arix Scheme. We believe
this combination will create immense value and opportunity for both
RTW BIO and Arix shareholders and are pleased two leading proxy
advisory firms have published recommendations in favour of the Arix
Scheme. We look forward to closing this transaction and leveraging
our talented investment team and scientific expertise to unlock
value day 1 and drive long-term value in an enhanced RTW BIO for
all of our future combined shareholders."
About RTW Biotech Opportunities Ltd
RTW Biotech Opportunities Ltd (LSE: RTW & RTWG) is an
investment fund focused on identifying transformative assets with
high growth potential across the biopharmaceutical and medical
technology sectors. Driven by a long-term approach to support
innovative businesses, RTW Biotech Opportunities Ltd invests in
companies developing next-generation therapies and technologies
that can significantly improve patients' lives. RTW Biotech
Opportunities Ltd is managed by RTW Investments, LP, a leading
healthcare-focused entrepreneurial investment firm with deep
scientific expertise and a strong track record of supporting
companies developing life-changing therapies.
About RTW Investments, LP
RTW Investments, LP is a New York-based, global, full life-cycle
investment firm that focuses on identifying transformational and
disruptive innovations across the biopharmaceutical and medical
technologies sectors. As a leading partner of industry and
academia, RTW combines deep scientific expertise with a
solution-oriented investment approach to advance emerging medical
therapies by building and supporting the companies and/or academics
developing them. For further information about RTW, please visit
www.RTWfunds.com .
Enquiries
RTW Biotech Opportunities Ltd +44 20 7959 6361
Woody Stileman ir@rtwfunds.com
BofA Securities (Sole Financial Adviser & Joint
Corporate Broker to RTW Bio) +44 20 7628 1000
Kieran Millar
Ed Peel
James Machin
Alex Penney
Deutsche Numis (Joint Corporate Broker to RTW Bio) +44 20 7260 1000
Freddie Barnfield
Nathan Brown
Euan Brown
Buchanan (PR & Communications adviser to RTW Bio) +44 20 7466 5107
Charles Ryland
Henry Wilson
George Beale
Cadarn Capital +44 7368 88321
David Harris
Important information
Merrill Lynch International ("BofA Securities"), which is
authorised by the Prudential Regulation Authority ("PRA") and
regulated by the Financial Conduct Authority ("FCA") and the PRA in
the United Kingdom, is acting exclusively for RTW BIO and for no
one else in connection with the matters referred to in this
announcement and will not be responsible to anyone other than RTW
BIO for providing the protections afforded to its clients or for
providing advice in relation to the matters referred to in this
announcement. Neither BofA Securities, nor any of its affiliates,
owes or accepts any duty, liability or responsibility whatsoever
(whether direct or indirect, whether in contract, in tort, under
statute or otherwise) to any person who is not a client of BofA
Securities in connection with this announcement, any statement
contained herein or otherwise, or any transaction or arrangement
referred to herein.
Numis Securities Limited (which is trading for these purposes as
Deutsche Numis) ("Deutsche Numis"), which is authorised and
regulated by the Financial Conduct Authority in the United Kingdom,
is acting as corporate broker exclusively for RTW BIO and for no
one else and will not be responsible to anyone other than RTW BIO
for providing the protections afforded to its clients or for
providing advice in relation to the matters referred to in this
announcement. Neither Deutsche Numis, nor any of its affiliates,
owes or accepts any duty, liability or responsibility whatsoever
(whether direct or indirect, whether in contract, in tort, under
statute or otherwise) to any person who is not a client of Deutsche
Numis in connection with this announcement, any statement contained
herein or otherwise, or any transaction or arrangement referred to
herein.
Notice to US Shareholders in Arix
This announcement is not for publication or distribution,
directly or indirectly, in or into the United States of America.
This announcement is not an offer of securities for sale into the
United States. The securities referred to herein have not been and
will not be registered under the U.S. Securities of 1933, as
amended (the "Securities Act"), any state securities laws or the
securities laws of any other jurisdiction and may not be offered or
sold in the United States or to any "U.S. persons" (as defined in
Rule 902 under the Securities Act), except pursuant to an
applicable exemption from registration. No public offering of
securities is being made in the United States.
The Scheme Shares will be offered and sold for investment
purposes only in the United States or to U.S. Persons (as such
terms are defined in Rule 902 of Regulation S promulgated under the
Securities Act) under the exemption from registration provided by
Section 4(a)(2) of the Securities Act and/or Regulation D
promulgated thereunder and in compliance with the applicable
securities laws of each state or other jurisdiction in which the
offering will be made. Each prospective investor that is within the
United States or that is a U.S. Person (as such term is defined in
Rule 902 of Regulation S promulgated under the Securities Act) must
be both (i) an "accredited investor" as defined in Rule 501(a) of
Regulation D of the Securities Act and (ii) a (A) "qualified
purchaser" as the term is defined under Section 2(a)(51) of the
U.S. Investment Company Act of 1940, as amended (the "1940 Act")
and the rules and regulations promulgated thereunder or (B)
"knowledgeable employee" as such term is defined in Rule 3c-5(a)(4)
promulgated under the 1940 Act. Scheme Shares will be offered and
sold outside of the United States to investors that are not U.S.
Persons in accordance with Regulation S under the Securities
Act.
RTW BIO is not registered, and does not intend to be subject to
registration, as an investment company under the 1940 Act in
reliance upon one or more exclusions or exemptions from
registration thereunder. U.S. Shareholders of Arix are requested to
execute an investor letter ("AI/QP Investor Letter") appended to
the Prospectus. The AI/QP Investor Letter contains representations
and restrictions on transfer designed to assure that the conditions
of such exclusions or exemptions will be met. Investors in RTW BIO
will therefore not receive the protections afforded by the 1940 Act
to investors in a registered investment company. RTW BIO will not
make a public offering of the Scheme Shares to satisfy the
exclusion from registration as an investment company under the 1940
Act. If RTW BIO is deemed to be an investment company and therefore
is required to register under the 1940 Act, such requirement could
prohibit RTW BIO from operating in its intended manner and could
have a material adverse effect on RTW BIO .
The Scheme Shares are subject to restrictions on transferability
and resale and may not be transferred or resold except as permitted
under the Securities Act, the 1940 Act and any applicable state and
other securities laws, pursuant to registration or an exclusion or
exemption therefrom. The transferability of the Scheme Shares are
further restricted by the terms of the AI/QP Investor Letter, and
any re-offer or resale of any Scheme Shares in the United States or
to U.S. Persons may constitute a violation of U.S. law. U.S.
Shareholders of Arix should be aware that they may be required to
bear the financial risks of any investment in RTW BIO for an
indefinite period of time. RTW BIO reserves the right to refuse to
accept any subscriptions, resales or other transfers of Scheme
Shares to U.S. Persons or to any person, including on the basis
that doing so would risk RTW BIO's loss of an exclusion or
exemption under U.S. securities laws (e.g., the Securities Act and
the 1940 Act). RTW BIO further reserves the right to require the
transfer or redemption of Scheme Shares held by any person for any
reason, including circumstances that may prejudice the tax status
of RTW BIO , may cause RTW BIO to be in violation of the Securities
Act, the 1940 Act or any applicable state securities act or may
cause RTW BIO to suffer any pecuniary, fiscal or administrative
disadvantage which may be unlawful or detrimental to the interests
or well-being of RTW BIO .
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END
UPDFLFIILLILFIS
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