Merger in the REIT space

Equity Commonwealth to acquire Monmouth Real Estate for $3.4B

Equity Commonwealth (EQC) and Monmouth Real Estate (MNR) announced that they have entered into a definitive merger agreement by which Equity Commonwealth will acquire Monmouth in an all-stock transaction, valued at approximately $3.4B, including the assumption of debt.

The combined company is expected to have a pro forma equity market capitalization of approximately $5.5B.

Under the terms of the agreement, Monmouth shareholders will receive 0.67 shares of Equity Commonwealth stock for every share of Monmouth stock they own.

Based on the closing price for Equity Commonwealth on May 4, this represents approximately $19.40 per Monmouth share.

The merger agreement provides for Monmouth to declare and pay one additional regular quarterly common stock dividend of 18c per share without Equity Commonwealth paying a corresponding common dividend to its shareholders.

Accordingly, the total consideration to be received by the Monmouth shareholders in the transaction is $19.58 per Monmouth share.

Equity Commonwealth and Monmouth shareholders are expected to own approximately 65% and 35%, respectively, of the pro forma company following the close of the transaction.

Monmouth’s portfolio is comprised of 120 properties totaling 24.5M square feet. In addition, Monmouth has six properties totaling 1.8M square feet under contract and leased to investment grade tenants.

Closings for these acquisitions are expected in 2021 and 2022.

The company will continue to be led by president and CEO David Helfand and the existing senior management team.

Upon closing, the number of trustees on Equity Commonwealth’s board will be expanded to 10, with two individuals designated by Monmouth’s board.

Sam Zell will remain the chairman of the board of trustees.

The transaction is expected to close during the second half of 2021, subject to customary closing conditions, including approval by the common shareholders of both Equity Commonwealth and Monmouth.

Sam Zell to become Chairman of the new company

The board of trustees of Equity Commonwealth and the board of directors of Monmouth Real Estate have each unanimously approved the transaction.

Equity Commonwealth ( EQC) is a Chicago based, internally managed and self-advised real estate investment trust (REIT) with commercial office properties in the United States. EQC’s same property portfolio is comprised of 4 properties and 1.5 million square feet.

Monmouth Real Estate Investment specializes in single tenant, net-leased industrial properties, subject to long-term leases, primarily to investment-grade tenants. Monmouth Real Estate is a fully integrated and self-managed real estate company, whose property portfolio consists of 121 properties, containing a total of approximately 24.5 million rentable square feet, geographically diversified across 31 states. 

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Welbilt sold for $4.3B

Middleby to acquire Welbilt in an all-stock transaction

The Middleby Corporation (MIDD) and Welbilt (WBT) have entered into a definitive agreement under which Middleby will acquire Welbilt in an all-stock transaction, enhancing the Middleby Commercial Foodservice platform with an attractive portfolio of products, brands and technologies.

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This transaction will bring together two complementary businesses, accelerate the Middleby growth strategy into key markets globally and increase core capabilities in highly attractive segments.

The combined company will have approximately $3.7B in combined 2020 sales, 73% of which will come from the Commercial Foodservice segment.

Under the terms of the agreement, Welbilt shareholders will receive a fixed exchange ratio of 0.1240x shares of Middleby common stock for each share of Welbilt common stock in an all-stock transaction, with an implied enterprise value of $4.3B.

Based on Middleby’s volume-weighted average price during the 30 consecutive trading days ending April 20, the offer price represents a 28% premium to Welbilt’s 30-day VWAP.

Upon closing, Middleby shareholders will own approximately 76% and Welbilt shareholders will own approximately 24% of the combined company on a fully diluted basis.

The Boards of both companies have unanimously approved the transaction. In addition, Carl C. Icahn, Welbilt’s largest shareholder with an 8.4% ownership position, has entered into a support agreement in favor of the transaction.

Following closing, Timothy FitzGerald will continue as CEO and as a member of the Middleby Board of Directors. Bryan Mittelman will continue to serve as Middleby’s CFO.

Middleby will expand its Board to include two new directors from the Welbilt board, Chairperson Cynthia Egnotovich and William Johnson. Middleby intends to refinance Welbilt’s existing debt through its committed Senior Secured Facility.

Based on the expected pro forma leverage ratio at closing, the interest on the incremental financing would be approximately L + 162.5 bps.

The transaction is expected to close in late 2021, subject to customary closing conditions, including regulatory and Middleby and Welbilt shareholder approvals.

The Middleby Corporation designs, manufactures, markets, distributes, and services a range of foodservice, food processing, and residential kitchen equipment.

Welbilt, Inc., designs, manufactures, and supplies foodservice equipment for commercial foodservice market worldwide. The company offers commercial upright and undercounter refrigerators and freezers, blast freezers and chillers, and cook-chill systems under the Delfield brand; and walk-in refrigerators, coolers and freezers, and prefabricated cooler and freezer panels under the Kolpak brand. 

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Microsoft buys Nuance

Microsoft to acquire Nuance for $56.00 per share in cash, or $19.7B

Microsoft (MSFT) and Nuance Communications (NUAN) announced they have entered into a definitive agreement under which Microsoft will acquire Nuance for $56.00 per share, implying a 23% premium to the closing price of Nuance on Friday, April 9, in an all-cash transaction valued at $19.7B, inclusive of Nuance’s net debt.

Nuance sold for $19.7B

Nuance is a trusted cloud and AI software leader representing decades of accumulated healthcare and enterprise AI experience.

Mark Benjamin will remain CEO of Nuance, reporting to Scott Guthrie, executive vice president of Cloud & AI at Microsoft.

The transaction is intended to close this calendar year.

Upon closing, Microsoft expects Nuance’s financials to be reported as part of Microsoft’s Intelligent Cloud segment.

Microsoft expects the acquisition to be minimally dilutive (less than 1%) in fiscal year 2022 and to be accretive in fiscal year 2023 to non-GAAP earnings per share, based on the expected close timeframe.

Non-GAAP excludes expected impact of purchase accounting adjustments, as well as integration and transaction-related expenses.

The acquisition will not impact the completion of its existing share repurchase authorization.

Nuance Communications, Inc. provides conversational and cognitive artificial intelligence (AI) innovations that bring intelligence to everyday work and life. The company delivers solutions that understand, analyze, and respond to people – amplifying human intelligence to increase productivity and security.

B. Riley analyst Zach Cummins reiterates a Buy rating on LivePerson (LPSN) with a $77 price target after Microsoft (MSFT) acquired Nuance Communications (NUAN), a provider of conversational commerce solutions, with expertise geared toward the healthcare vertical.

The potential deal acquisition provides a “positive valuation data point” for LivePerson, a leading provider of conversational commerce solutions across the telecom, financial services, retail, and consumer verticals, Cummins tells investors in a research note.

LivePerson currently trades at an enterprise value to sales multiple of 6.5 times, below the comp group median of 9.5 times and Nuance’s implied takeout multiple of 12.5 times, says the analyst.

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Fly Leasing sold for $2.36B

Carlyle Aviation to acquire Fly Leasing for $17.05 per share

Fly Leasing (FLY) announced that it has entered into a definitive agreement to be acquired by an affiliate of Carlyle Aviation Partners, the commercial aviation investment and servicing arm within The Carlyle Group’s (CG) $56B Global Credit platform.

Fly Leasing sold for $2.36B

Under the terms of the Merger Agreement, FLY shareholders will receive $17.05 per share in cash, representing a total equity valuation of approximately $520M.

The total enterprise value of the transaction is approximately $2.36B.

FLY’s portfolio of 84 aircraft and seven engines is on lease to 37 airlines in 22 countries.

The per share cash consideration represents a premium of approximately 29% to FLY’s closing price on March 26, 2021 and a 43% premium to the volume-weighted average share price during the last 30 trading days.

The Board of Directors of FLY has approved the Merger Agreement, acting upon the recommendation of a special committee appointed by the Board of Directors and consisting solely of independent and disinterested directors, and has recommended that FLY shareholders vote in favor of the transaction.

The transaction is expected to close in the third quarter of 2021 and is subject to customary closing conditions, including applicable regulatory clearance and the approval of FLY’s shareholders.

Given the pending transaction, FLY will not host a first quarter earnings call.

FLY closed at $13.25.

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Merger in the railroad space!

Canadian Pacific to buy Kansas City Southern in $29B deal

Canadian Pacific Railway (CP) and Kansas City Southern (KSU) announced they have entered into a merger agreement, under which CP has agreed to acquire KCS in a stock and cash transaction representing an enterprise value of approximately $29B, which includes the assumption of $3.8B of outstanding KCS debt.

The transaction, which has the unanimous support of both boards of directors, values KCS at $275 per share, representing a 23% premium, based on the CP and KCS closing prices on March 19, 2021.

Following the closing into a voting trust, common shareholders of KCS will receive 0.489 of a CP share and $90 in cash for each KCS common share held.

Following final approval from the Surface Transportation Board, the transaction will combine the two railroads to create the first rail network connecting the U.S., Mexico, and Canada.

Canadian Pacific Rails

Joining seamlessly in Kansas City, Mo., in America’s heartland, CP and KCS together will connect customers via single-network transportation offerings between points on CP’s system throughout Canada, the U.S. Midwest, and the U.S. Northeast and points on KCS’ system throughout Mexico and the South Central U.S.

While remaining the smallest of six U.S. Class 1 railroads by revenue, the combined company will be a much larger and more competitive network, operating approximately 20,000 miles of rail, employing close to 20,000 people and generating total revenues of approximately $8.7 billion based on 2020 actual revenues.

Combined Companies Rails

The combination is expected to be accretive to CP’s adjusted diluted EPS in the first full year following CP’s acquisition of control of KCS, and is expected to generate double-digit accretion upon the full realization of synergies thereafter.

To fund the stock consideration of the merger, CP will issue 44.5 million new shares.

The cash portion will be funded through a combination of cash-on-hand and raising approximately $8.6B in debt, for which financing has been committed.

As part of the merger, CP will assume approximately $3.8B of KCS’ outstanding debt.

Following the closing into trust, CP expects that its outstanding debt will be approximately $20.2B. Pro forma for the transaction, CP estimates its leverage ratio against 2021E street consensus EBITDA to be approximately 4.0-times with the assumption of KCS debt and issuance of new acquisition-related debt.

In order to manage this leverage effectively, CP will be temporarily suspending its normal course issuer bid program, and expects to produce approximately $7B of levered free cash flow over the next three years.

CP estimates its long-term leverage target of approximately 2.5x to be achieved within 36 months after closing into trust.

The combined company will remain committed to maintaining strong investment grade credit ratings while continuing to return capital for the benefit of shareholders.

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Berkshire Hathaway reports record profit

Buffett also said in his annual shareholder letter to “never bet against America.”

Warren Buffett Berkshire Hathaway’s (BRK.A, BRK.B) fourth quarter profits rose, with its net earnings rising to $38.5B, or $23,015 a Class A share equivalent, up almost 23% from the previous year’s profit of $29.2B, or $17,909 a share.

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Operating earnings, which exclude some investment results, rose to $5 billion from $4.4 billion the year before.

Buffett also said in his annual shareholder letter to “never bet against America.”

“In its brief 232 years of existence… there has been no incubator for unleashing human potential like America,” he added.

“Despite some severe interruptions, our country’s economic progress has been breathtaking. Our unwavering conclusion: Never bet against America.” Buffett said the conglomerate owns the biggest amount of U.S. assets by value than any other company in the country.

Berkshire Hathaway also bought back a record amount of company stock last year. During the fourth quarter, the company bought back about $9B shares for a total 2020 repurchase of $24.7B.

Buffett said in his annual shareholder letter that repurchases have continued since year-end and “is likely to further reduce its share count in the future.”

“That action increased your ownership in all of Berkshire’s businesses by 5.2% without requiring you to so much as touch your wallet,” the letter reads.

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Wrike sold for $2.25B cash

Citrix to acquire Wrike for $2.25B in cash

Citrix Systems (CTXS) announced that it has entered into a definitive agreement to acquire Wrike, a rapidly growing, recognized leader in the SaaS collaborative work management space, for $2.25B in cash.

Wrike ended calendar year 2020 with more than $140 million in unaudited SaaS ARR, reflecting more than 30 percent CAGR in SaaS ARR over the prior two years.

Citrix spends $2.55B to expand its offerings

The company is expected to have approximately 30 percent stand-alone growth to between $180M-$190M in SaaS ARR1 in 2021, with the opportunity to accelerate growth over time under Citrix’s ownership.

The addition of Wrike is highly complementary to Citrix’s existing customer base and is expected to accelerate Citrix’s SaaS ARR growth.

Wrike founders cash out

Financing and purchase accounting impacts to deferred revenue will affect 2021 non-GAAP earnings per share. Integration and other costs related to the acquisition are expected to be modestly dilutive to non-GAAP earnings per share in 2021.

The transaction is expected to be neutral to Citrix’s fiscal year 2022 non-GAAP earnings per share and free cash flow, and accretive thereafter.

Citrix expects to fund the transaction with a combination of new debt and existing cash and investments.

Citrix is committed to its investment grade credit ratings and plans to return to historical leverage levels within 24 months.

Citrix has obtained a commitment from JPMorgan Chase Bank, N.A. for a $1.45B senior unsecured 364-day bridge loan facility.

The transaction, which has been unanimously approved by the board of directors of both Citrix and Wrike, is expected to close in the first half of 2021, subject to regulatory approvals and other customary closing conditions.

SaaS is the new trend in software usage

Until close, the companies will continue to operate independently.

Upon closing, Andrew Filev, Wrike CEO will continue to lead the Wrike team and report to Arlen Shenkman, EVP and CFO, Citrix.

CTXS closed at $132.00.

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$5B Merger in LNG Space

New Fortress Energy to buy Hygo ,Golar LNG Partners combined in $5B deal

New Fortress Energy (NFE) announced that it has entered into definitive agreements to acquire Hygo Energy Transition a 50-50 joint venture between Golar LNG Limited (GLNG) and Stonepeak Infrastructure Fund II Cayman.

New Fortress goes shopping

“With a strong presence in Brazil and a world-class LNG shipping business, Hygo and GMLP are excellent additions to our efforts to accelerate the world’s energy transition,” said Wes Edens, Chairman and CEO of NFE.

“The addition of Hygo will quickly expand our footprint in South America with three gas-to-power projects in Brazil’s large and fast-growing market. With GMLP, we gain LNG ships and world-class operators that are an ideal fit to support our existing terminals and robust pipeline.”

“We are impressed with what Wes Edens and the NFE team have created and their commitment to changing the energy industry,” said Golar LNG Chairman Tor Olav Troim.

“They share our vision to provide cheaper and cleaner energy to a growing population. The consolidation of two of the entrepreneurial LNG downstream players gives the company improved access to capital and creates a unique world-leading energy transition company which Golar shareholders will benefit from being a part of going forward.”

With the acquisition of Hygo, NFE will acquire an operating floating storage and regasification unit terminal and a 50% interest in a 1500MW power plant in Sergipe, Brazil as well as two other FSRU terminals with 1200MW of power in advanced stages in Brazil.

Hygo’s fleet consists of a newbuild FSRU and two operating LNG carriers.

NFE will also acquire a leading owner of FSRUs and LNG carriers as well as a pioneer in floating liquefaction technologies with the GMLP transaction.

The addition of GMLP’s fleet of six FSRUs, four LNG carriers and a 50% interest in Trains 1 and 2 of the Hilli, a floating liquefaction vessel, is expected to support both NFE’s , NFE will acquire all of the outstanding shares of Hygo for 31.4M shares of NFE Class A common stock and $580M in cash.

The transaction is valued at a $3.1B enterprise value and a $2.18B equity value.

Pursuant to the transaction, GLNG will receive 18.6 million shares of NFE Class A common stock and $50 million in cash and Stonepeak will receive 12.7 million shares of NFE Class A common stock and $530 million in cash.

Hygo’s Board of Directors, together with GLNG and Stonepeak, the shareholders of Hygo, have unanimously approved the proposed transaction with NFE.

The closing of the transaction is subject to the receipt of certain regulatory approvals and third party consents and other customary closing conditions, and is expected to occur in the first half of 2021.

Under NFE’s agreement with GMLP , NFE has agreed to acquire all of the outstanding common units of GMLP for $3.55 per common unit in cash.

NFE has also agreed to acquire GMLP’s general partner for equivalent consideration based on the general partner’s economic interest in GMLP.

The preferred units of GMLP will remain outstanding. The transaction is valued at a $1.9B enterprise value and $251 million common equity value.

GMLP’s Board of Directors, acting upon the recommendation of a special committee of independent directors of GMLP, unanimously approved the proposed transaction with NFE.

The closing of the transaction is subject to the approval by the holders of a majority of GMLP’s outstanding common units, the receipt of certain regulatory approvals and third party consents and other customary closing conditions, and is expected to occur in the first half of 2021.

GLNG has entered into a support agreement with NFE committing to vote its approximately 30.8% interest in GMLP’s common units in favor of the transaction.

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RealPage sold for $10.2 billion

RealPage to be acquired by Thoma Bravo for $88.75 per share in cash

RealPage (RP) announced it has entered into a definitive agreement to be acquired by Thoma Bravo, a private equity investment firm focused on the software and technology-enabled services sector, in an all-cash transaction that values RealPage at approximately $10.2B, including net debt.

Real Page sold for $10.2 billion

Under the terms of the agreement, RealPage stockholders will receive $88.75 in cash per share of RealPage common stock upon closing of the transaction.

The purchase price represents a premium of 30.8% over RealPage’s closing stock price of $67.83 on December 18, 2020, a premium of 36.5% over RealPage’s 30-day volume-weighted average share price through that date, and a premium of 27.8% over RealPage’s all-time high closing stock price of $69.47 on December 7.

The RealPage board has unanimously approved the agreement with Thoma Bravo and recommends that RealPage stockholders vote in favor of the transaction at the special meeting of RealPage stockholders to be called in connection with the transaction.

Thoma Bravo buys the real estate software company

Upon completion of the transaction, RealPage expects to continue operating under the leadership of chairman and CEO Steve Winn and the existing RealPage leadership team based in Richardson, Texas.

Closing of the transaction is subject to customary conditions, including approval by the holders of a majority of the outstanding shares of RealPage common stock, expiration or early termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, and receipt of other required regulatory approvals.

A special meeting of RealPage stockholders will be held in early 2021, following the filing of a definitive proxy statement with the U.S. Securities and Exchange Commission.

Winn and certain affiliated entities, which collectively own approximately 10% of the outstanding shares of RealPage common stock, have entered into a voting agreement with Thoma Bravo pursuant to which they have agreed, among other things, to vote their shares of RealPage common stock in favor of the merger, and against any competing transaction, so long as, among other things, the RealPage board continues to recommend that RealPage stockholders vote in favor of the merger.

Consistent with the board’s commitment to maximizing stockholder value, under the terms of the definitive merger agreement, RealPage’s board and advisors may actively initiate, solicit and consider alternative acquisition proposals during a 45-day “go shop” period.

RealPage has the right to terminate the merger agreement to accept a superior proposal during the go-shop period, subject to the terms and conditions of the merger agreement.

There can be no assurances that this process will result in a superior proposal, and RealPage does not intend to disclose developments with respect to this solicitation process unless and until RealPage’s board makes a determination requiring further disclosure.

The parties expect the transaction to close in Q2 of 2021. Upon completion of the transaction, RealPage will become a privately held company, and its common stock will no longer be listed on the Nasdaq stock market.

RP closed at $67.83.

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Aerojet Rocketdyne sold for $5 billion

Lockheed Martin to acquire Aerojet Rocketdyne

Lockheed Martin (LMT) announced it has entered into a definitive agreement to acquire Aerojet Rocketdyne (AJRD) for $56 per share in cash, which is expected to be reduced to $51 per share after the payment of a pre-closing special dividend.

Aerojet sold for $5 billion

This represents a post-dividend equity value of $4.6B and a total transaction value of $4.4B including the assumption of net cash.

As part of approving the transaction, Aerojet Rocketdyne announced a special cash dividend, revocable at its option through the payment date, of $5 per share to its holders of record of common stock and convertible senior notes as of the close of business on March 10, 2021, and payable on March 24, 2021.

Lockheed Martin brings most of it’s rocket manufacturing to in-house with this deal

The transaction is expected to close in the second half of 2021 and is subject to the satisfaction of customary closing conditions, including regulatory approvals and approval by Aerojet Rocketdyne’s stockholders.

Aerojet Rocketdyne designs, develops, manufactures, and sells aerospace and defense products and systems in the United States.

The Aerospace and Defense segment offers aerospace and defense products and systems for the United States government, including the Department of Defense, the National Aeronautics and Space Administration, and aerospace and defense prime contractors. This segment provides liquid and solid rocket propulsion systems, air-breathing hypersonic engines, and electric power and propulsion systems for space, defense, civil, and commercial applications; and armament systems.

Large Solid Rockets made by Aerojet

The Real Estate segment engages in the re-zoning, entitlement, sale, and leasing of the company’s excess real estate assets. It owns approximately 11,394 acres of land adjacent to the United States Highway 50 between Rancho Cordova and Folsom, California east of Sacramento.

AJRD closed at $42.02. LMT closed at $356.03.

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Curo Group shares jump on sale of its subsidiary!

Curo Group surges after Katapult announces merger with SPAC

Shares of Curo Group Holdings (CURO) have surged in Friday trading after the company announced earlier today that it is positioned to benefit from the announcement that Katapult Holding, a company approximately 40% owned by Curo and a leading provider of e-commerce point-of-sale lease purchase options for non-prime U.S. consumers, and FinServ Acquisition Corp.

(FSRV), a publicly traded special purpose acquisition company, or “SPAC,” have entered into a definitive merger agreement.

The transaction values Katapult’s equity at $908M, which includes an earnout of up to $75M in the form of additional common shares in the new public company, Curo said.

“Based on Curo’s ownership in Katapult, the transaction announced today will provide consideration consisting of a combination of cash and stock in the new company to CURO of $365M, which includes an earnout of up to $30M in the form of additional common shares in the new public company.

To date, Curo has made a total cash investment in Katapult of $27.5M,” the company noted.

Upon the closing of the transaction, Curo anticipates receiving cash of up to $125 million and maintaining an ownership stake of at least 21% of the fully-diluted shares of the new public company, CURO added. In afternoon trading, Curo shares have risen $7.09, or 81%, to $15.88. Shares hit a high of $20.81.

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Merger creates $4B cannabis company

 Aphria, Tilray announce $3.9B combination

Aphria (APHA) and Tilray (TLRY) announced that they have entered into a definitive agreement to combine their businesses and create the world’s largest global cannabis company based on pro forma revenue.

Aphria merges with Tilray

The deal is pursuant to a plan of arrangement under the Business Corporations Act and the implied pro forma equity value of the combined company is approximately $3.9B, based on the share price of Aphria and Tilray at the close of market on December 15.

Following the completion of the arrangement, the combined company will have principal offices in the United States, Canada, Portugal and Germany, and it will operate under the Tilray corporate name with shares trading on Nasdaq under ticker symbol (TLRY).

Tilray merges with Aphria

The combined company will have a complete portfolio of branded Cannabis 2.0 products in Canada.

In the United States, the combined company will have a consumer packaged goods presence and infrastructure with two strategic pillars, including SweetWater Brewing and Manitoba Harvest.

Under the terms of the Arrangement, the shareholders of Aphria will receive 0.8381 shares of Tilray for each Aphria common share, while holders of Tilray shares will continue to hold their Tilray shares with no adjustment to their holdings.

Upon the completion of the arrangement, Aphria Shareholders will own approximately 62% of the outstanding Tilray Shares on a fully diluted basis, resulting in a reverse acquisition of Tilray, representing a premium of 23% based on the share price at market close on December 15 to Tilray shareholders.

On a pro forma basis for the last twelve months reported by each company, the combined company would have had revenue of $685M.

Upon completion of the arrangement, Aphria’s current chairman and CEO, Irwin Simon, will lead the combined company as chairman and CEO.

The board of directors will consist of nine members, seven of which, including Simon, are current Aphria directors and two of which will be from Tilray, including Brendan Kennedy, and one of which is to be designated.

The combined company will have pro forma revenue of $685M for the last twelve months reported by each company, the highest in the global cannabis industry.

In Canada, the combination of Aphria and Tilray will create the leading adult-use cannabis company with gross revenue of C$296M in the adult-use market for the twelve months reported by each company.

The combination of Aphria and Tilray is expected to deliver approximately C$100M of annual pre-tax cost synergies within 24 months of the completion of the transaction.

The combined company expects to achieve cost synergies in the key areas of cultivation and production, cannabis and product purchasing, sales and marketing and corporate expenses.

Under the terms of the agreement, the arrangement will be carried out by way of a court approved plan of arrangement under the Business Corporations Act and will require the approval of at least two-thirds of the votes cast by the Aphria Shareholders at a special meeting.

Approval of a majority of the votes cast by Tilray stockholders will be required to, among other things contemplated by the Agreement, authorize the issuance of Tilray shares to Aphria shareholders pursuant to the Arrangement. Following completion of the Arrangement, Aphria will become a wholly-owned subsidiary of Tilray, with Aphria shareholders owning approximately 62% of Tilray.

The arrangement is expected to close in the second quarter of calendar year 2021 following the receipt of such regulatory approvals, as well as court approval of the Arrangement.

Each of Aphria’s and Tilray’s respective directors and officers and certain principal Tilray Stockholders have entered into voting support agreements agreeing to vote their Aphria Shares or Tilray Shares, as applicable, in favor of the resolutions put before them pursuant to the agreement.

Note that this merger probably was forced on the companies by market forces. Covid-19 pandemic has hurt cannabis industry similar to restaurants and movie theaters. APHA is up 5 cents to $8.18. TLRY is up $1.51 to $9.38. TLRY shares have an all time high of $300.

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Prevail Therapeutics sold for $1.04 billion

Eli Lilly to acquire Prevail Therapeutics for up to $26.50 per share in cash

Eli Lilly (LLY) and Prevail Therapeutics (PRVL) announced a definitive agreement for Lilly to acquire Prevail for $22.50 per share in cash payable at closing plus one non-tradable contingent value right, or CVR, worth up to $4.00 per share in cash, for a total consideration of up to $26.50 per share in cash, or or an aggregate of approximately $1.04B.

Prevail sold for more than $1 billion

The CVR is payable upon the first regulatory approval of a product from Prevail’s pipeline as set forth in more detail below.

Prevail is a biotechnology company developing potentially disease-modifying AAV9-based gene therapies for patients with neurodegenerative diseases.

The acquisition will establish a new modality for drug discovery and development at Lilly, extending Lilly’s research efforts through the creation of a gene therapy program that will be anchored by Prevail’s portfolio of clinical-stage and preclinical neuroscience assets.

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Prevail’s lead gene therapies in clinical development are PR001 for patients with Parkinson’s disease with GBA1 mutations and neuronopathic Gaucher disease and PR006 for patients with frontotemporal dementia with GRN mutations.

Prevail’s preclinical pipeline includes PR004 for patients with specific synucleinopathies, as well as potential gene therapies for Alzheimer’s disease, Parkinson’s disease, amyotrophic lateral sclerosis and other neurodegenerative disorders.

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Under the terms of the agreement, Lilly will commence a tender offer to acquire all outstanding shares of Prevail Therapeutics Inc. for a purchase price of $22.50 per share in cash payable at closing plus one non-tradeable CVR.

The CVR entitles Prevail stockholders to up to an additional $4.00 per share in cash payable upon the first regulatory approval for commercial sale of a Prevail product in one of the following countries: United States, Japan, United Kingdom, Germany, France, Italy or Spain.

To achieve the full value of the CVR, such regulatory approval must occur by December 31, 2024.

If such regulatory approval occurs after December 31, 2024, the value of the CVR will be reduced by approximately 8.3c per month until December 1, 2028.

There can be no assurance any payments will be made with respect to the CVR. The transaction is not subject to any financing condition and is expected to close in Q1 of 2021, subject to customary closing conditions, including receipt of required regulatory approvals and the tender of a majority of the outstanding shares of Prevail’s common stock.

Following the successful closing of the tender offer, Lilly will acquire any shares of Prevail that are not tendered in the tender offer through a second-step merger at the same consideration as paid in the tender offer.

The purchase price payable at closing represents a premium of approximately 117% to the 60-day volume-weighted average trading price of Prevail’s common stock ended on December 14, the last trading day before the announcement of the transaction.

Prevail’s board of directors unanimously recommends that Prevail’s stockholders tender their shares in the tender offer.

Additionally, certain Prevail stockholders, beneficially owning approximately 51% of Prevail’s outstanding common stock, have agreed to tender their shares in the tender offer.

Upon closing, the impact of this transaction will be reflected in Lilly’s 2021 financial results according to Generally Accepted Accounting Principles.

There will be no change required to Lilly’s 2021 financial guidance being issued for research and development expense or non-GAAP earnings per share as a result of this transaction.

Prevail Therapeutics (PRVL) last traded at $22.67, up 81%.

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Big Rock Partners buys NeuroRx

NeuroRx to trade on Nasdaq following Big Rock Partners Acquisition merger

Big Rock Partners Acquisition (BRPA) announced that it has entered into an agreement and plan of merger with NeuroRx, a clinical stage, small molecule pharmaceutical company.

Big Rock shares jump on purchase of NeuroRx

NeuroRx develops novel therapeutics for the treatment of COVID-19 and Bipolar Depression.

Under the terms of the transaction, Big Rock and NeuroRx will merge and the company is expected to continue to trade on the Nasdaq Stock Market under the symbol (NRXP).

The transaction is expected to occur in the first or second quarter of 2021.

As a public Nasdaq-listed company, NeuroRx expects to have increased access to capital to continue development of its drug pipeline targeting Central Nervous System/Psychiatry and Respiratory Disease.

NeuroRx is a clinical stage, small molecule pharmaceutical company which develops novel therapeutics for the treatment of central nervous system disorders and life-threatening pulmonary disease.

NeuroRx’s two main drugs are Zyesami which is an application for COVID-related respiratory failure and NRX-101, which focuses on suicidal bipolar depression and PTSD.

Zyesami is a synthetic human vasoactive intestinal peptide, or VIP, a 28 amino-acid natural peptide with 50 years of research. NRX-101 is a fixed-dose combination of D-cycloserine and lurasidone that has advanced to phase 3 with FDA Breakthrough Therapy Designation, a Special Protocol Agreement, Biomarker Letter of Support, and Fast Track Designation.

NeuroRx’s management team is comprised of industry veterans, led by founder, Chairman & CEO Jonathan C. Javitt, MD, MPH, Robert Besthof, MIM (Chief Commercial Officer), William Fricker, MBA, CPA (Chief Financial Officer) and Alessandra Daigneault, JD (Corporate Secretary), who are expected to continue to run the combined company, post-transaction.

All officers and members of the board of Big Rock will resign in connection with the closing of the transactions.

The board of the combined company will initially consist of seven members, including Prof. Jonathan Javitt.

Under the terms of the transaction, Big Rock will issue to NeuroRx’s current equity holders an aggregate of 50M shares of Big Rock common stock for their interests in NeuroRx, representing $500M of equity consideration, assuming a value of $10.00 per common share.

Subject to certain conditions, an aggregate of 25M additional shares of Big Rock common stock will be issued to NeuroRx pre-merger equity holders if, prior to December 31, 2022, RLF-100 receives emergency use authorization by the FDA and the FDA accepts the company’s filing of its application to approve RLF-100.

In addition, subject to certain conditions, a $100M cash earnout may be payable to NeuroRx pre-merger equity holders if, prior to December 31, 2022, either FDA approval of the company’s COVID-19 Drug is obtained and the company’s COVID-19 Drug is listed in the FDA’s or FDA approval of the company’s Antidepressant Drug Regimen is obtained and the company’s Antidepressant Drug Regimen is listed in the FDA’s “Orange Book”.

The boards of both NeuroRx and Big Rock have unanimously approved the proposed transaction.

Completion of the transaction is subject to approval by stockholders of NeuroRx and Big Rock and other customary closing conditions.

BRPA is up 30% to $15.50.

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Pluralsight sold for $3.5 billion

Pluralsight to be acquired by Vista for $20.26 per share in cash

Pluralsight (PS) announced that it has entered into a definitive agreement to be acquired by Vista Equity Partners.

Pluralsight sold for $3.5 billion

Pluralsight, Inc. operates a cloud-based technology skills platform in the United States, Europe, the Middle East, Africa, and internationally. Its platform products include Pluralsight Skills for individuals and teams to acquire technology skills through skill development experiences, such as skill assessments, a curated library of expert-authored courses, directed learning paths, interactive content, and business analytics; and Pluralsight Flow, which gives technology leaders objective data and visibility into workflow patterns to measure the productivity of their software developers. 

Under the terms of the agreement, Vista, in partnership with its institutional co-investors including Partners Group, will acquire all outstanding shares of Pluralsight common stock for $20.26 per share in an all-cash transaction valued at approximately $3.5B.

Company has benefited from “stay home”

The purchase price represents a premium of approximately 25% to the company’s volume weighted average closing stock price for the 30 trading days prior to today’s announcement.

The deal has been unanimously approved and recommended by an independent Transaction Committee and then unanimously approved by the Pluralsight board.

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Pluralsight has also entered into a voting agreement with certain of its shareholders, under which such shareholders have agreed to vote all of their Pluralsight shares in favor of the transaction.

The Pluralsight shares subject to the voting agreement represent a majority of the current outstanding voting power of Pluralsight shares. “In response to receipt of unsolicited acquisition interest, Pluralsight engaged in a robust process, including evaluating transaction alternatives against Pluralsight’s standalone plan and other strategic alternatives,” the company said.

The transaction is expected to close in the first half of 2021. PS closed at $18.98.

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