by Charlotte Schubert on April 28, 2022 at 4:53 pmApril 28, 2022 at 6:30 pm
Global investment firm All Blue Capital has offered to buy Zymeworks, a public biotech company based in Vancouver, B.C., with operations in Seattle.
All Blue delivered a letter to the Zymeworks board on Thursday offering to acquire the company for $10.50 per share, for a total of $773 million in cash, according to a regulatory filing.
The non-binding proposal offers a share price more than twice the $4.88 value at market close on Wednesday. The stock gained more than 30% in after-hours trading on Thursday, after Reuters first reported the bid.
“We believe that the Company has suffered from severe value erosion due to a number of serious missteps by an unfocused leadership with no clear strategy for improving performance,” All Blue’s letter to the board said.
Zymeworks has been through a series of recent shakeups, and replaced its CEO in January with industry veteran Kenneth Galbraith. Galbraith announced plans to lay off a quarter of the company’s workforce amidst a “streamlined” R&D strategy focused on its clinical oncology programs. The company also raised $100 million in January in a public offering, pricing its shares around $8, far below a high of more than $50 early last year.
Dubai-based All Blue Capital currently owns close to 5.5% of Zymeworks’ shares. The firm’s investments include Pinterest, SpaceX, Peloton, Lyft and other tech-focused companies.
All Blue is “under no obligation to engage in any discussions or consummate any transaction,” according to its letter, and the firm “may determine to change the terms of the proposal, withdraw the proposal or otherwise change their intentions” at any time.
Zymeworks released a statement Thursday afternoon. “The Zymeworks board of directors will carefully review the proposal to determine the course of action that it believes is in the best interest of the company and all Zymeworks’ shareholders. The board reminds shareholders that no formal offer has been made,” said the statement, adding, “as such there is no need for Zymeworks shareholders to take any action at this time. If a formal offer is made, it will be reviewed by the board with its advisors, and a formal recommendation by the board will be made to shareholders in due course.”
Zymeworks is developing “bispecific antibodies” that recognize two different molecular targets simultaneously, as well as other types of treatments. Its lead candidate is in late-stage clinical trials.
Editor’s note: This story has been updated with Zymeworks’ response.
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