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Investing.com - Jefferies downgraded Lava Therapeutics NV (NASDAQ:LVTX) from Buy to Hold and lowered its price target to $1.50 from $3.00 following news of XOMA Royalty’s acquisition of the company. The stock, currently trading at $1.47, has shown strong momentum with a 54.5% gain year-to-date, according to InvestingPro data.
XOMA Royalty will acquire Lava Therapeutics for $1.16-$1.24 per share in an all-cash transaction, plus a contingent value right (CVR) tied to partnered and unpartnered assets.
The acquisition follows management’s strategic review aimed at maximizing shareholder value and includes the discontinuation of LAVA-1266, a CD123-targeted bispecific therapy.
The CVR component of the deal will provide shareholders with 75% of net proceeds from programs partnered with Johnson & Johnson and Pfizer (NYSE:PFE), as well as unpartnered programs.
Jefferies views the acquisition as "the best path to maximize shareholder value" for Lava Therapeutics, according to its research note explaining the downgrade.
In other recent news, XOMA Royalty Corporation has announced agreements to acquire both LAVA Therapeutics N.V. and HilleVax, Inc. in separate deals. LAVA Therapeutics shareholders will receive between $1.16 and $1.24 per share in cash, along with a contingent value right representing 75% of net proceeds from LAVA’s partnered assets and any out-licensing or sale of unpartnered programs. In the agreement with HilleVax, XOMA Royalty will pay $1.95 in cash per share and offer a contingent value right. This right allows HilleVax stockholders to receive potential payments, including any remaining cash exceeding $102.95 million and a percentage of savings from the company’s Boston office lease obligations. Additionally, HilleVax stockholders may receive proceeds from any sale or licensing of its norovirus vaccine programs within five years following regulatory approval. These recent developments highlight XOMA Royalty’s strategic moves to expand its portfolio through acquisitions.
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