NEW YORK – Bluebird Bio on Wednesday recommended that all stockholders tender into the company's agreement to be acquired by funds managed by investment firms Carlyle and SK Capital Partners, despite receiving a separate, unsolicited proposal from another firm.
Somerville, Massachusetts-based Bluebird said that Ayrmid, which is the parent company of Gamida Cell, had submitted a nonbinding written proposal to purchase it for more money than its current acquisition agreement. However, after three weeks of engagement including a timeline extension, Ayrmid has not submitted a binding proposal to acquire it and has not obtained necessary financing.
After consulting with financial and legal advisers, Bluebird's board of directors reaffirmed its support for the transaction with Carlyle and SK Capital.
"Ayrmid's proposal remains highly conditional, despite an extension to the previously agreed-upon timeline to complete confirmatory diligence and submit a binding offer," Mark Vachon, chairman of Bluebird's board of directors, said in a statement. "After careful consideration with our financial and legal advisors, discussions with Hercules Capital, and taking into account that absent a significant infusion of capital, Bluebird continues to be at significant risk of defaulting on its loan covenants, the board unanimously reaffirms its support of the previously announced agreement with Carlyle and SK Capital in the strongest possible terms."
Bluebird has faced financial challenges in recent years despite garnering approvals for multiple gene therapies, including one of the first gene therapies for sickle cell disease, Lyfgenia (lovotibeglogene autotemcel). After its board conducted a comprehensive review of strategic alternatives, including meeting with more than 100 potential investors and partners, Bluebird in February announced a deal with Carlyle and SK Capital.
Under the terms of this deal, Bluebird stockholders would receive $3.00 per share in cash and a one-time contingent value right (CVR) per share that entitles them to $6.84 in cash upon the achievement of a net sales milestone.
Soon after, Bluebird received an unsolicited nonbinding written proposal from Ayrmid to acquire it for an upfront cash payment of $4.50 per share and a one-time CVR of $6.84 per share payable upon achievement of a net sales milestone. Ayrmid had previously met with Bluebird as part of the company's review of strategic alternatives but at the time had not submitted a proposal. Bluebird had agreed to a two-week period of confirmatory diligence with Ayrmid, after which Ayrmid would submit a binding offer.
However, on April 11, at the request of Ayrmid, Bluebird agreed to extend the period by four days. Still, Ayrmid has yet to deliver a binding offer and has acknowledged that it has not obtained the necessary financing for its proposal and continues to pursue financing, according to Bluebird.
Bluebird recommends stockholders tender into the current agreement with Carlyle and SK Capital Partners by May 2.