Sorrento turns down $1B acquisition proposal from private equity firm
Category: #business  By Mateen Dalal  Date: 2020-01-29
  • shareshare_icon
  • Twitter
  • Facebook
  • LinkedIn

Sorrento turns down $1B acquisition proposal from private equity firm

Sorrento Therapeutics, a clinical stage biopharmaceutical company developing new treatments for cancer and autoimmune diseases, has reportedly rejected a takeover proposal from an unnamed private equity fund.

Sorrento, a California based firm, gathered considerable traction during the 2015 biotech boom on the back of an agreement which gave Nanthealth, controlled by Patrick Soon-Shiong, the rights to a nanoparticle drug formulation of paclitaxel. Sorrento rapidly fell from that high and has not come close to recovering the lost ground, kicking off 2020 with a share price of above $3. 

A private equity unit thought that Sorrento was worth considerably more than that. Sorrento, at the start of this month disclosed that it had received a takeover proposal of nearly $7 a share, a price that would have translated into a deal worth $1 billion.

The Sorrento board of directors, however, have declined the offer, stating that it significantly devalues the company and was not in the best interest of the investors. The precise terms of the proposal remain private, thereby making it difficult to determine whether the bid was likely to total $7 a share or a low amount covered by the up to part of the statement of Sorrento.

The rejection came months after Sorrento had knocked back proposals from two biopharmaceutical companies that were willing to pay somewhere between $3 and $5 per share. During that phase, the board also rejected the bids unanimously, stating that they devalued the company.

Shares in Sorrento fell after news of the most recent rejection but remained above the price they were trading at, during the start of the year and beyond the level they declined at before news of the dismissals of the $3 to $5 offers arose. The improvement in the share price of Sorrento, which was less than $2 in November, could also benefit the company if it attempts to accelerate its balance sheet.

The firm ended the month of September with approximately $34.6 million cash as well as equivalents, which is down from the $158.7 million during the start of 2019, along with a $356.5 million of long-standing debt.

The firm could also add to its cash assets by closing one of the several possible strategic transactions and alliances, which it is pursuing, but it equally might need to bring in more capital.

 

Source credit: https://www.fiercebiotech.com/biotech/sorrento-rejects-1b-buyout-bid-from-unnamed-private-equity-firm

  • shareshare_icon
  • Twitter
  • Facebook
  • LinkedIn


About Author

Mateen Dalal     twitter

Mateen Dalal

A qualified electronics and telecommunication engineer, Mateen Dalal embarked on his professional journey working as a quality and test engineer. Harnessing his passion for content creation however, Mateen pens down industry-rich articles for ReportsGO.com and a few o...

Read More..

More News By Mateen Dalal

Xiaomi and Oppo team up with UNISOC to manufacture in-house 5G chipsets

Xiaomi and Oppo team up with UNISOC to manufacture in-house 5G chipsets

By Mateen Dalal

The two companies intend to introduce their custom-made sub-6GHz 5G chipsets by the end of 2021. UNISOC has managed to raise around USD 817.20 million for its new venture. Chinese electronics giants including Xiaomi Corp. and Guangdong Oppo Mob...

Twitter explored USD 4 billion takeover of audio-chat app Clubhouse

Twitter explored USD 4 billion takeover of audio-chat app Clubhouse

By Mateen Dalal

Twitter, an American microblogging service company, had touted plans of acquiring Clubhouse, an audio chat iPhone app and live drop-in audio networking platform. The deal was estimated to be valued at around USD 4 billion, as per reliable sources. T...

Beyond Meat sets up factory in China to expedite localized innovation

Beyond Meat sets up factory in China to expedite localized innovation

By Mateen Dalal

American plant-based meat substitute producer Beyond Meat has opened a new production facility in China. Apparently, this recent setup is the company’s first facility outside the U.S., making it the only multinational organization solely focusi...