Equillium to acquire Metacrine in all-stock deal

7 September 2022
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La Jolla, California-based immunology specialist Equillium (Nasdaq: EQ) and Metacrine (Nasdaq: MTCR) have entered into a definitive merger agreement whereby Equillium will acquire Metacrine in an all-stock transaction, edging the latter’s shares up 2.7% to $0.47 by close of trading on Tuesday

The transaction is anticipated to add $33 million in cash to Equillium’s balance sheet at closing, which is expected to extend the company’s cash runway into 2024. The transaction has been approved by the boards of directors of both companies, and is expected to close by late 2022.

The transaction consideration will be comprised entirely of stock, where Equillium will issue stock valued at a 25% premium over the net cash delivered at closing, which is estimated to be approximately $26 million. Net cash is total cash, cash equivalents, and short-term investments, adjusted by certain factors including debt, which includes term debt with an outstanding principal of $15 million, and other liabilities, as defined in the merger agreement.

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