Elevation Oncology agrees to Concentra Biosciences buyout

BOSTON - Elevation Oncology, Inc. (NASDAQ:ELEV), currently trading at $0.32 with a market capitalization of approximately $19 million, has agreed to be acquired by Concentra Biosciences, LLC, in a definitive merger agreement announced today. The deal values Elevation Oncology at $0.36 per share in cash, along with a non-tradeable contingent value right (CVR). The CVR entitles shareholders to additional proceeds based on future dispositions of Elevation Oncology’s assets, particularly its EO-1022 product, within a specified timeframe. According to InvestingPro data, the company holds more cash than debt on its balance sheet, potentially strengthening its negotiating position.

Elevation Oncology’s Board of Directors has unanimously approved the merger, considering it beneficial for all stockholders. The decision comes as the company’s stock has experienced a significant decline, falling over 90% in the past year. In accordance with the agreement terms, a subsidiary of Concentra will soon launch a tender offer to acquire all outstanding Elevation Oncology shares. The offer, set to commence by June 23, 2025, is contingent on several conditions, including the tendering of a majority of Elevation Oncology’s shares and the availability of sufficient closing cash. InvestingPro analysis shows the company maintains a strong current ratio of 19.4, indicating robust short-term liquidity to support the transaction.

Key Elevation Oncology stakeholders, who own approximately 5.1% of the company’s common stock, have agreed to support the merger. The transaction is expected to close in July 2025 if all conditions are met.

Fenwick & West LLP and Gibson, Dunn & Crutcher LLP are providing legal counsel to Elevation Oncology and Concentra Biosciences, respectively.

The transaction’s forward-looking statements involve risks and uncertainties, including the possibility that the required conditions may not be satisfied, the potential for competing offers, and the risk of litigation. These factors could affect the completion and timing of the merger as well as the potential benefits to Elevation Oncology’s stockholders. For deeper insights into merger dynamics and comprehensive financial analysis, consider accessing additional metrics through InvestingPro, which offers exclusive data points and real-time updates on company valuations and financial health scores.

The press release also notes that the tender offer has not yet commenced and further details will be available upon its initiation. Investors and security holders are advised to read the tender offer materials and the Solicitation/Recommendation Statement when they become available for important information.

This news is based on a press release statement from Elevation Oncology.

In other recent news, Elevation Oncology has announced the discontinuation of its drug candidate EO-3021, which was in Phase 1 trials for treating gastric and gastroesophageal junction cancers. The decision followed clinical trial results that showed an objective response rate of 22%, which the company found insufficient for further development. In response to this, Piper Sandler downgraded Elevation Oncology’s stock from Overweight to Neutral, citing concerns over the halted drug’s efficacy. Citizens JMP analysts also adjusted their rating from Market Outperform to Market Perform, reflecting caution due to the uncertain timeline for clinical data on another drug, EO-1022.

Despite these challenges, Elevation Oncology is shifting its focus to EO-1022, a HER3 antibody-drug conjugate, with promising preclinical data scheduled for presentation at the AACR Annual Meeting in 2025. The company plans to file an Investigational New Drug application for EO-1022 in 2026. Additionally, Elevation Oncology has opted for early repayment of a $30 million term loan, demonstrating its financial capability to manage debt obligations proactively. The company is also undergoing a significant workforce reduction of approximately 70%, expecting associated costs of around $3 million.

These strategic moves, including the workforce changes and loan repayment, indicate Elevation Oncology’s efforts to realign its resources and explore strategic alternatives to maximize shareholder value. Investors will be closely monitoring the progress of EO-1022 and potential partnerships or transactions. The company’s current cash reserves are expected to fund operations into the second half of 2026, providing some financial stability as it navigates these developments.

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