Aerovate approves reverse split ahead of Jade merger

WALTHAM, Mass. - Aerovate Therapeutics, Inc. (NASDAQ:AVTE), currently trading at $2.75, announced on Monday that its board of directors has approved a 1-for-35 reverse stock split. This decision follows the recent stockholder approval of Aerovate’s merger with Jade Biosciences, Inc. The reverse split is scheduled in anticipation of the merger’s completion, with the combined company expected to trade under the new ticker "JBIO" on Nasdaq starting April 29, 2025. According to InvestingPro data, the stock has seen significant price movement over the past year, trading between $1.25 and $25.29.

The reverse stock split will significantly reduce Aerovate’s outstanding common stock from about 30 million shares to approximately 0.8 million shares, while the authorized common stock will remain unchanged at 300 million shares. This action does not affect the number of authorized shares, which stockholders approved to double in connection with the merger during the special meeting on April 16, 2025. InvestingPro analysis shows the company maintains a strong liquidity position with a current ratio of 20.93, indicating substantial cash reserves compared to short-term obligations.

Additionally, stockholders of record as of April 25, 2025, will receive a special cash dividend of an estimated $2.40 per share, based on the number of shares outstanding before the reverse split. The cash dividend, totaling approximately $69.6 million, is unaffected by the reverse split and reflects Aerovate’s commitment to provide value to its stockholders. This special dividend comes at a time when InvestingPro data indicates the company has been managing its cash position carefully, with more cash than debt on its balance sheet (subscribers can access 8 additional ProTips about AVTE’s financial health).

Following the merger, Jade Biosciences is expected to have around 32.2 million shares issued and outstanding, or about 60.6 million on a fully diluted basis. The reverse stock split will also prompt adjustments to the exercise prices and the number of shares underlying Aerovate’s outstanding equity awards, with no change to the par value per share.

Aerovate, a biotechnology company focused on rare cardiopulmonary diseases, is merging with Jade Biosciences, which is developing therapies for autoimmune diseases. Jade’s lead asset, JADE-001, is targeting a first-in-human trial in the second half of 2025, with two more undisclosed antibody discovery programs in preclinical development.

The merger and related proposals, including the reverse stock split, were approved by Aerovate’s stockholders at the special meeting, and the board’s decision aligns with these approved parameters. The information in this article is based on a press release statement from Aerovate Therapeutics.

In other recent news, Aerovate Therapeutics, Inc. has announced a special cash dividend of $69.6 million, or approximately $2.40 per share, in anticipation of its merger with Jade Biosciences, Inc. This dividend is set to be distributed to stockholders of record as of April 25, 2025, and will be payable on April 29, 2025. The merger, contingent upon stockholder approval and other conditions, is expected to close around April 28, 2025. Aerovate’s board of directors has yet to finalize the exact dividend amount, which could range from $67.6 million to $69.6 million, depending on the company’s net cash position at the time of the merger. The merger aims to combine Aerovate’s expertise in rare cardiopulmonary diseases with Jade Biosciences’ focus on autoimmune therapies. Jade’s lead asset, JADE-001, is preparing for human trials in late 2025 for the treatment of IgA nephropathy. Stockholders will vote on the merger at a special meeting scheduled for April 16, 2025. Aerovate has advised stockholders to contact their proxy solicitor, Innisfree M&A Incorporated, for assistance with voting or meeting inquiries.

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