LianBio (Nasdaq: LIAN) (“LianBio” or the “Company”), a
biotechnology company dedicated to bringing innovative medicines to
patients in China and other major Asian markets, today
announced that the Company’s Board of Directors (the “Board”) had
completed its comprehensive strategic review of the Company and
determined to initiate the wind down of its operations, including
the sale of remaining pipeline assets, the delisting of its
American Depositary Shares (“ADSs”), each representing the right to
receive one ordinary share, from the Nasdaq Global Market
(“Nasdaq”) and deregistration under Section 12(b) of the Securities
Exchange Act of 1934 (the “Exchange Act”) and workforce reductions.
The Company currently anticipates a substantial portion of the wind
down activities, including fulfillment of transition service
obligations under its existing agreements and gradual cessation of
currently active clinical trials, will be completed by the end of
2024. In parallel with the wind down of operations, the Board has
declared a special cash dividend in the amount of $4.80 per
ordinary share, including ordinary shares represented by ADSs, for
an aggregate cash dividend amount of approximately $528 million.
“In October 2023, the Board of Directors initiated a
comprehensive strategic review of the Company, including numerous
options for the future of the Company, as our commitment to
represent the best interests of LianBio and shareholders,” said
Konstantin Poukalov, Founder and Executive Chairman of LianBio’s
Board. “Following the shift in focus away from mavacamten
commercialization and the licensing of rights to NBTXR3 to Janssen,
the Board unanimously decided that winding down operations is the
way to realize maximum shareholder value in the current biotech
market.”
In accordance with the strategic review, the following actions
will be taken:
Wind Down and Workforce ReductionLianBio will
begin to wind down operations immediately and intends to pursue the
sale of its remaining pipeline assets as part of the wind down
process. To the extent such sales are successful, the Company
expects to distribute any profits from the sales to its
then-current shareholders in a subsequent distribution before the
final dissolution of the Company. However, there is no guarantee
that any shareholder’s original investment, or any material amount,
will be recovered.
With reduced operations, the Company expects to reduce its
workforce by over 50 full-time employees, or approximately 50% of
the Company’s current employee base, in the first quarter of 2024.
Additional workforce reductions will occur over the course of 2024
following the transition of assets to partners and the fulfillment
of the Company’s transition services obligations. The Company will
maintain a core group of employees necessary to implement an
orderly wind down of the Company and support its efforts to
maximize the value of the Company’s remaining business and
assets.
LianBio expects that the full wind down of operations, including
the sale of remaining assets or termination of licenses, as well as
the termination of employees necessary to complete an orderly wind
down, will be substantially complete by the end of 2024, with the
complete dissolution expected to occur during the first half of
2027. The Company expects to meet its ongoing operational costs
through funds retained after the special dividend.
Nasdaq Delisting and SEC DeregistrationOn
February 13, 2024, the Company, pursuant to an authorization by the
Board, provided notice to Nasdaq that it intends to file a Form 25
with the U.S. Securities and Exchange Commission (the “SEC”) on or
about March 8, 2024 to effect the voluntary delisting of the
Company’s ADSs from Nasdaq and to deregister the ADSs under Section
12(b) of the Exchange Act. As a result, the Company currently
expects that the last day of trading on Nasdaq will be on or
about March 18, 2024, when Form 25 takes effect. Ninety days
thereafter, the deregistration of the Company’s ADSs under Section
12(b) of the Exchange Act is expected to become effective.
Following the delisting of the Company’s ADSs from Nasdaq, the
Company intends to file a Form 15 with the SEC certifying that it
has fewer than 300 shareholders of record, upon which the Company’s
filing obligations under the Exchange Act will immediately be
suspended, including the obligations to file all periodic
reports.
Following the delisting, any trading in the Company’s ADSs would
only occur in privately negotiated sales and potentially on an
over-the-counter market. The Company expects that its ADSs will be
quoted on a market operated by OTC Markets Group Inc. (the “OTC”)
so that a trading market may continue to exist for its ADSs. There
is no guarantee, however, that a broker will continue to make a
market in the ADSs and that trading of the ADSs will continue on an
OTC market or otherwise.
The Board believes that the decision to delist the ADSs from the
Nasdaq and deregister and suspend its reporting obligations under
the Exchange Act is in the best interests of the Company and the
holders of its ordinary shares and ADSs. As the Company undertakes
steps to wind down operations and return value to the shareholders
through its asset sales, out-licensing efforts and the payment of
dividends, the Board has determined that the burdens associated
with operating as a registered public company outweigh any
advantages to the Company and its holders of ordinary shares and
ADSs. The Board’s decision was based on careful review of numerous
factors, including the potential for curbing the significant costs
associated with preparing and filing periodic reports with the SEC
and the legal, audit and other expenses associated with being a
reporting company, as well as the substantial costs and demands on
management’s time under the Sarbanes-Oxley Act of 2002, SEC rules
and Nasdaq listing standards.
Authorization of Special Cash DividendThe Board
has declared a special cash dividend of $4.80 per ordinary
share, including ordinary shares represented by ADSs, for an
aggregate cash dividend amount of approximately $528 million. The
special dividend is payable to holders of record of the Company’s
ordinary shares and ADSs as of the close of business
on February 27, 2024. The Company expects to pay the dividend
to its holders of record of ordinary shares on or about March
11, 2024. Citibank, the Depositary of the ADSs (the “Depositary”),
will coordinate payment of the dividend to the holders of record of
the Company’s ADSs, net of applicable Depositary fees of US$0.05
per ADS held and applicable taxes, and expects to pay the dividend
on March 14, 2024. The ex-dividend date for the ADSs for the
special dividend will be the first trading day following the
payment date. Holders of record of ADSs on the record date who sell
their ADSs prior to the ex-dividend date will not receive the
special dividend.
In connection with the special cash dividend, the Depositary
will close the books to ADS issuances and ADS cancellations at the
close of business in New York City on February 20, 2024. The
Depositary will re-open the books for ADS cancellations at the
close of business in New York City on March 18, 2024. The
applicable Depositary fees will apply for all ADS issuances and ADS
cancellations.
LianBio stockholders are urged to consult their respective tax
advisor regarding the U.S. federal, state, local and foreign income
and other tax consequences to them, in light of their particular
investment or tax circumstances, of the receipt of the special
dividend.
About LianBioLianBio is a cross-border
biotechnology company on a mission to bring transformative
medicines to historically underserved patients in China and other
Asian markets. For more information, please visit
www.lianbio.com.
Cautionary Note Regarding Forward-Looking
StatementsStatements in this press release about future
expectations, plans and prospects, as well as any other statements
regarding matters that are not historical facts, may constitute
forward-looking statements. The words “anticipate,” “expect,”
“believe,” “intend,” “continue,” “potential,” “may,” “will” and
similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain
these identifying words. Forward-looking statements in this press
release include, but are not limited to, statements concerning the
Board’s comprehensive strategic review; the Company’s plans for
payment of the special cash dividend, including with respect to
timing and the special dividend amount, and the potential for
payment of any future dividends upon the culmination of the wind
down of the Company’s operations; the Company’s plans with respect
to the delisting and deregistration of its securities; the
perceived benefits and timing of the wind down; the Company’s
ability to pursue the sale of its remaining pipeline assets and
termination of its outstanding licenses; the Company’s plans and
expected timing with respect to the reduction in workforce; the
timeline in which the Company expects to be able to wind down its
operations; and the trading of the Company’s ADSs following the
voluntary delisting of the ADSs from Nasdaq. Actual results may
differ materially from those indicated by such forward-looking
statements as a result of various important factors, including: the
risk that the delisting, deregistration and wind down process will
take longer than expected and that the benefits of such actions may
not be realized; general market conditions; the impact of changing
laws and regulations and those risks and uncertainties described in
LianBio’s filings with the SEC, including LianBio’s Annual Report
on Form 10-K for the year ended December 31, 2022 and its
subsequent filings with the SEC. Any forward-looking statements
contained in this press release speak only as of the date hereof,
and LianBio specifically disclaims any obligation to update any
forward-looking statement, whether as a result of new information,
future events or otherwise. Readers should not rely upon this
information as current or accurate after its publication date.
For investor inquiries, please contact:
Elizabeth Anderson, VP Communications and Investor
Relations E:
elizabeth.anderson@lianbio.com T: +1 646 655
8390
For media inquiries, please contact:
Katherine Smith, Inizio Evoke
E: katherine.smith@inizioevoke.com
T: +1 619 849 5378
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