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- Anew Medical on Tuesday has entered into a definitive business combination pact with Redwoods Acquisition (NASDAQ:RWOD).
- ANEW is developing a platform and commercializing novel gene therapies to alleviate and/or reverse the progression of neurogenerative diseases.
- With current ANEW owners transferring 100% of their shares into the merged business, the transaction values the combined firm at a pro forma enterprise value of around $94.0M.
- Following the transaction's completion, ANEW investors will be qualified to receive extra shares as part of an earn-out depending on the merged company's stock performance. In the event that no Redwoods investors choose to redeem their shares, the transaction is anticipated to generate cash proceeds of around $54M. These figures don't include the extra earn-out shares of up to five million that would be given to ANEW investors if the necessary stock performance-based conditions were satisfied.
- ANEW intends to use the proceeds from the transaction to progress its lead gene therapy programs including for amyotrophic lateral sclerosis (ALS) and Alzheimer's disease (AD).
- After completion of the deal, the combined company will operate as Anew Medical and expects to remain listed on NASDAQ.
- The merged firm is anticipated to use all cash that remains on its balance sheet at the time of the transaction's conclusion, after transaction-related costs have been paid, for working capital, expansion, and other general corporate goals.
- The proposed business combination is expected to be completed by the fourth quarter of 2023.