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Anew Medical Expecting to Access $54M Following SPAC Merger

NEW YORK – Anew Medical, a company in the early stages of developing gene therapies for neurodegenerative diseases, on Tuesday said it has entered into a definitive merger agreement with Redwoods Acquisition, a publicly traded special purpose acquisition company.

The combined company has a pro forma enterprise value of around $94 million. Anew stockholders will roll over all their equity into the new company. Anew, previously called Strategic Asset Leasing and listed in the OTC Markets as "LEAS," expects the merger to bring in $54 million in proceeds, assuming no redemptions from Redwoods stockholders.

The firm's stockholders may receive an additional 5 million earn-out shares based on how the combined company's stock performs after the transaction closes in Q4 2023. The combined firm expects to remain listed on the Nasdaq.

Anew hopes to use the proceeds from the transaction to advance its portfolio of gene therapies for Alzheimer's disease, Parkinson's disease, and amyotrophic lateral sclerosis, as well as for working capital, growth, and other general corporate purposes. The company said it is collaborating with scientific institutions to develop therapies that deliver the gene that makes the Klotho protein, which has anti-aging properties. In addition, researchers have seen this protein decline with age in Alzheimer's patients' brains and in mice genetically engineered to have the neurodegenerative disease.

Research has further suggested that treating neurons with the Klotho protein hormone can keep them from dying due to accumulation of toxic glutamate and beta-amyloid protein. The company is hoping that by increasing Klotho protein levels, its gene therapies might prevent development of Alzheimer's if given early in the disease trajectory. Anew is planning to integrate a proprietary gene splice variant, called secreted klotho, and deliver the gene construct to the cell cytoplasm via adeno-associated viruses that are designed to lead to the protein being concentrated in the central nervous system and muscle tissue.

"Anew is focused on developing disruptive new gene therapies to alleviate and/or reverse the progression of devastating neurodegenerative diseases," Anew CEO and Founder Joseph Sinkule said in a statement. "The partnership with Redwoods as well as the listing on Nasdaq constitutes an ideal pathway to raise additional capital and fund our strategic initiatives going forward."

According to information on Anew's website, the company is in the very early stages of developing its gene therapies. It expects to begin human testing between 2024 and 2025 and seek regulatory approval between 2026 and 2027 if late-stage clinical trials are successful.

Chardan is Anew's M&A and capital markets adviser. Cyruli Shanks & Zizmor is Anew's legal counsel and Loeb & Loeb is Redwoods' legal counsel.