Alexza Pharmaceuticals, Inc. and Grupo Ferrer Internacional, S.A. have entered into a definitive agreement under which Ferrer Pharma Inc., a wholly-owned subsidiary of Ferrer, will acquire Alexza for $0.90 per share in cash. In addition to the upfront cash payment, Alexza stockholders will be granted contingent value rights to receive cash payments in four payment categories if specified milestones are achieved following the closing. The transaction is expected to close in the second quarter of 2016 and is subject to customary closing conditions.
The $0.90 per share cash consideration represents a 210% premium to Alexza's closing share price on February 26, 2016, the last trading day prior to announcement that Alexza and Ferrer had entered into a non-binding letter of intent with respect to Ferrer's proposed acquisition of Alexza, a 177% premium to the volume-weighted average trading price over the thirty trading days ending on February 26, 2016, and a 67% premium to the closing price on May 9, 2016.
"We see Ferrer as the ideal company to acquire Alexza as we continue to strive toward global commercial success with ADASUVE and to re-energize our Staccato-based product pipeline," said Thomas B. King, President and CEO of Alexza. "Over the past four years, we have come to appreciate their professionalism, passion, dedication and commitment to Alexza's technologies, products and people. With this combination, we feel that Alexza's products will be well positioned for long-term success in serving important patient needs."
"We are pleased that Alexza, the company that created and developed ADASUVE and the Staccato technology, will be part of Ferrer and we look forward to working with our new Alexza colleagues to continue creating significant value for patients worldwide. We firmly believe that the Staccato technology will change the lives of patients with severe mental and neurological disorders. At the same time it will help healthcare professionals to improve their management in the increasingly digitalized and personalized healthcare context," said Jordi Ramentol, CEO of Ferrer.
Under the terms of the agreement, Ferrer Pharma will commence a tender offer to acquire all outstanding shares of Alexza's common stock for $0.90 per share in cash plus one contingent value right entitling the stockholder to receive a pro-rata share of up to four payment categories in an aggregate (i.e., to all contingent value right holders assuming all four payments are made) maximum amount of $35 million (subject to certain deductions) if certain licensing payments and revenue milestones are achieved.
Upon successful completion of the tender offer, Ferrer Pharma will acquire all remaining shares not tendered in the tender offer through a second-step merger at the same price and with the obligation to make the same contingent cash consideration payments as are made to stockholders tendering their shares in the tender offer. The tender offer and withdrawal rights are expected to expire at 12:00 midnight, New York City time on the 20th business day after the launch of the tender offer, unless extended in accordance with the merger agreement and the applicable rules and regulations of the U.S. Securities and Exchange Commission ("SEC").
The consummation of the tender offer is subject to various conditions, including a minimum tender of a number of Alexza shares that, when added to the shares held by Ferrer, represents a majority of outstanding shares (including shares issued upon the exercise of options). The Board of Directors of Alexza unanimously approved the transaction.