NewLink Genetics Corporation (NASDAQ:NLNK) (“NewLink” or the
“Company”) today publicly announced its rejection of the
unsolicited acquisition proposal received on November 5, 2019 from
Evercel, Inc. (“Evercel”) (OTC:EVRC), a holding company with a
primary operating business selling line matrix printers and
accessories.
The NewLink Board of Directors (the “Board”), consistent with
its fiduciary duties and in consultation with outside financial and
legal advisors, thoroughly evaluated the Evercel proposal and has
determined that it is not in the best interests of NewLink’s
stockholders. The Board concluded that the Evercel proposal is not
actionable because it does not constitute, and could not reasonably
be expected to lead to, a “Superior Offer” as defined in the
definitive merger agreement (the “Lumos Merger Agreement”) with
Lumos Pharma, Inc. (“Lumos”). As a result, the Evercel proposal
does not satisfy the requirements in the Lumos Merger Agreement for
granting due diligence access or commencing negotiations with
respect to a competing proposal.
The Board is confident that the NewLink and Lumos combination
will drive long-term sustainable value and believes that the Lumos
Merger Agreement, entered into on September 30, 2019, represents
the best path forward for its investors. As previously announced,
NewLink’s largest stockholder, Stine Seed Farm, Inc., has signed a
support agreement to vote in favor of the merger and remains in
committed support, without qualification.
NewLink continues to remain focused on completing the proposed
merger and the subsequent development of Lumos Pharma’s lead
candidate, LUM-201 (ibutamoren), a potential oral therapy for
pediatric growth hormone deficiency (PGHD) and other rare endocrine
disorders. PGHD occurs due to inadequate production of growth
hormone in the pituitary gland during childhood leading to lack of
physical growth and/or short stature.
Under the Lumos Merger Agreement, NewLink will issue Lumos
stockholders NewLink common stock in exchange for their shares in
Lumos such that Lumos stockholders will own approximately 50% of
outstanding shares of the combined company upon closing.
Immediately following the closing of the merger, Lumos will become
a wholly-owned subsidiary of NewLink, and NewLink will be renamed
“Lumos Pharma, Inc.” and is expected to trade on Nasdaq under the
symbol “LUMO.”
The Board remains committed to completing its planned
transaction with Lumos, which is expected to close in the first
quarter of calendar year 2020 and is subject to customary closing
conditions, including the approval of NewLink’s stockholders.
NewLink is being advised by Stifel as financial advisor and
Cooley LLP as legal counsel.
Additional Information about the Merger
and Where to Find It
In connection with the proposed merger (the "Merger") among
NewLink, Cyclone Merger Sub, Inc., a Delaware corporation and
wholly-owned subsidiary of the Company (the "Merger Sub"), and
Lumos, pursuant to the terms of the Lumos Merger Agreement, by and
among NewLink, Merger Sub and Lumos, the Company intends to file
relevant materials with the Securities and Exchange Commission (the
“SEC”), including a proxy statement for its stockholders containing
the information with respect to the Merger and the Lumos Merger
Agreement specified in Schedule 14A promulgated under the
Securities Exchange Act of 1934, as amended and describing the
proposed Merger. The proxy statement and other relevant materials
(when they become available), and any other documents filed by the
Company with the SEC, may be obtained free of charge at the SEC
website at www.sec.gov. In addition, investors and security holders
may obtain free copies of the documents filed with the SEC by the
Company by directing a written request to: NewLink Genetics
Corporation, 2503 South Loop Drive, Ames, IA 50010. Investors and
security holders are urged to read the proxy statement and the
other relevant materials when they become available before making
any voting or investment decision with respect to the Merger.
Participants in the Solicitation
The Company and its directors and executive officers and Lumos
and its directors and executive officers may be deemed to be
participants in the solicitation of proxies from the stockholders
of the Company in connection with the proposed transaction.
Information regarding the special interests of these directors and
executive officers in the merger will be included in the proxy
statement referred to above. Additional information regarding the
directors and executive officers of the Company is also included in
the Company’s Annual Report on Form 10-K for the year ended
December 31, 2018 and the proxy statement for the Company’s 2019
Annual Meeting of Stockholders. These documents are available free
of charge at the SEC web site (www.sec.gov) and from the Company at
the address described above.
About NewLink Genetics Corporation
NewLink is a clinical-stage biopharmaceutical company that has
historically focused on developing novel immunotherapeutic products
for the treatment of patients with cancer. On September 30, 2019,
NewLink announced its intent to merge with Lumos, a private
clinical-stage biopharmaceutical company targeting rare and
neglected diseases. At the close of the proposed Merger, the
combined company will operate as Lumos Pharma, Inc. focused on
Lumos’ sole product candidate, LUM-201 (ibutamoren), an oral growth
hormone (GH) secretagogue targeting pediatric growth hormone
deficiency (PGHD) and other rare endocrine disorders. If approved,
LUM-201 has the potential to represent the first orally
administered growth hormone stimulating therapy for a subset of
PGHD patients, an established market where daily recombinant human
growth hormone injections represent the current standard-of-care
treatment regimen. For more information, please visit
www.NewLinkGenetics.com.
Cautionary Note Regarding Forward-Looking
Statements
This press release contains forward-looking statements
of NewLink that involve substantial risks and
uncertainties. All statements contained in this press release are
forward-looking statements within the meaning of The Private
Securities Litigation Reform Act of 1995. The words “forecast,”
“projected,” "guidance," "upcoming," "will," "plan," “intend,”
"anticipate," "approximate," "expect," “potential,” or the negative
of these terms or other similar expressions are intended to
identify forward-looking statements, although not all
forward-looking statements contain these identifying words. These
forward-looking statements include, among others, statements
regarding the Company’s expectations with respect to the Evercel
proposal, the completion and timing of the planned transaction with
Lumos and other information relating to such transaction; and any
other statements other than statements of historical fact. Actual
results or events could differ materially from the plans,
intentions and expectations disclosed in the forward-looking
statements that NewLink makes due to a number of important
factors, including (i) the risk that the transaction with Lumos may
not be completed in a timely manner or at all, which may adversely
affect NewLink’s business and the price of common stock of NewLink;
(ii) the failure to satisfy the conditions to the Lumos Merger
Agreement, including approval of the issuance of shares of NewLink
common stock in the transaction or the contemplated reverse stock
split; (iii) the occurrence of any event, change or other
circumstance that could give rise to the termination of the Lumos
Merger Agreement; (iv) the risk that the Lumos Merger Agreement may
be terminated in circumstances that require NewLink to pay a
termination fee to Lumos; (v) risks related to the ability to
realize the anticipated benefits of the transaction with Lumos,
including the risk that the businesses will not be integrated
successfully; (vi) the effect of the pendency of the transaction
with Lumos on NewLink’s business relationships, operating results
and business generally; (vii) the risk that the proposed
transaction with Lumos disrupts current plans and operations;
(viii) risks related to diverting management’s attention from
NewLink’s ongoing business operations; and (ix) other business
effects, including the effects of industry, market, economic,
political or regulatory conditions, future exchange and interest
rates, and changes in tax and other laws, regulations, rates and
policies. Further risks that could cause actual results to differ
materially from those matters expressed in or implied by such
forward-looking statements are discussed in "Risk Factors" and
elsewhere in NewLink’s Quarterly Report on Form 10-Q for the
quarter ended September 30, 2019 and other reports filed
with the SEC. The forward-looking statements in this press
release represent NewLink’s views as of the date of this press
release. NewLink anticipates that subsequent events and
developments will cause its views to change. However, while it may
elect to update these forward-looking statements at some point in
the future, it specifically disclaims any obligation to do so. You
should, therefore, not rely on these forward-looking statements as
representing NewLink’s views as of any date subsequent to the
date of this press release.
Investor & Media Contact:
Lisa MillerDirector of Investor RelationsNewLink
Genetics515-598-2555lmiller@linkp.com
or Sloane & Company Dan Zacchei / Joe Germani, 212-486-9500
dzacchei@sloanepr.com / jgermani@sloanepr.com
Source: NewLink Genetics Corporation
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