Biotie to acquire Newron in merger
Biotie Therapies Corp. and Newron Pharmaceuticals S.p.A. have signed an agreement by which Biotie will acquire Newron for EUR 45 million ($61.29 million).
HELSINKI, Finland—Biotie Therapies Corp. and NewronPharmaceuticals S.p.A. have signed an agreement by which Biotie will acquireNewron for EUR 45 million ($61.29 million). The acquisition will gain Biotie apipeline with clinical-stage compounds in the areas of central nervous system(CNS) disorders and niche inflammatory disease as well as access to Newron'sextensive CNS expertise and its business partners.
"We are excited about our acquisition of NewronPharmaceuticals, a company with a considerable presence in the CNS space and acompelling late-stage asset in safinamide with potential for significantnear-term milestones," Timo Veromaa, President and Chief Executive Officer ofBiotie, said in a press release. "Our combined portfolio, addressing majormarket opportunities, promises to deliver differentiated novel medicines topatients in areas of unmet medical need."
Under the terms of the agreement, Newron will merge intoBiotie, which will gain all of Newron's assets, rights, debts and otherliabilities. Newron's shareholders will receive a share considerationconsisting of an initial consideration of a total of 89,108,147 shares inBiotie and two Contingent Value Rights (CVRs), with the realization of thoseCVRs dependent on reaching agreed-upon development stages for safinamide withinthe two years following the merger's announcement.
"We have been working hard to find the right partnerand in Biotie we believe we have the best combination to create a European entitywith critical mass to ensure that our pipeline will generate value for ourshareholders," Luca Benatti, Managing Director and Chief Executive Officer ofNewron, said in a press release.
The combined pipeline will include Biotie's nalmefene forthe treatment of alcohol dependence and Newron's safinamide, a once-a-daypotential adjunctive therapy for all stages of Parkinson's disease. Thecombined pipeline of the two companies will also include novel drugs for thetreatment of Parkinson's disease, movement disorders, Alzheimer's disease,post-traumatic stress disorder, rheumatoid arthritis, psoriasis and chronicobstructive pulmonary disease.
"We see this transaction as a win-win for bothcompanies' shareholders and it confirms Biotie as a key consolidator ofhigh-quality CNS assets," said Veromaa. "We look forward to optimizing thecombined robust product pipeline to create value for our shareholders, partnersand other stakeholders."
Newron's revenues for 2010 were EUR 0.8 ($1.09 million), andits revenues for the first two quarters of 2011 were EUR 0.9 million ($1.23million). Newron's chief financial officer Stefan Weber will join Biotie'smanagement team, though no changes will be made to Biotie's board of directors.The acquisition is not expected to affect Biotie's Finnish or United Statesoperations or organizations, but the Newron organization's structure in Italyand Switzerland will be reviewed. Restructuring plans are in the works.
At the end of June, the number of employees at Biotie stoodat 39, while Newron's personnel numbered at 29.
KPMG Oy Ab has been appointed by both companies as anindependent expert in terms of the merger and is expected to give a statementon the plan on or about Sept. 29, after which the plan will be filed with theItalian Companies' Register as well as the Finnish Trade Register. The deal issubject to the approval of Biotie's board of directors, fulfillment ofprocedural requirements and additional condition, and the approval of the EGMof Newron, which is expected to be held near the end of October. Newron's boardof directors has unanimously recommended that the EGM approve the merger. Theexpected date for execution of the transaction is December 2011.
Cowen and Company LLC was brought on as exclusive financialadvisor to Biotie, while Hannes Snellman Attorneys Ltd., Studio Legale Delfinoe Associati, Wilkie Farr & Gallagher, LLP and Blum & Grob Attorneys atLaw Ltd were brought on as Biotie's legal advisors. Newron brought on JSBPartners LLC as financial advisors, and Chiomenti Studio Legale as its legaladvisors for the deal.
SOURCE: Biotie Therapies Corp. press release