Keros Therapeutics to return $375 million to shareholders

LEXINGTON, Mass. - Keros Therapeutics, Inc. (NASDAQ:KROS), a biopharmaceutical company specializing in the development of treatments for disorders related to the TGF-β family of proteins, announced today that it plans to return $375 million of excess capital to its shareholders. According to InvestingPro data, the company maintains a strong financial position with more cash than debt and a healthy current ratio of 19.29. This decision comes after a comprehensive strategic review process aimed at maximizing stockholder value, with analysis suggesting the stock is currently undervalued.

The Board of Directors, following consultations with financial and legal advisors, decided unanimously to initiate a process to distribute the capital. While the exact terms and structure of the return are still under consideration, the company expects to provide details at a future date. The capital return represents a significant portion of Keros’s current market capitalization of $610.86 million.

Jean-Jacques Bienaimé, Lead Independent Director, stated, "Our Board and management team are taking action to enhance stockholder value. To that end, we intend to return a significant amount of excess capital to stockholders while continuing to pursue development of our lead product candidate, KER-065, for the treatment of neuromuscular diseases, with an initial focus on Duchenne muscular dystrophy."

During the strategic review, the company explored various alternatives, including a potential sale, other business combination transactions, or continued investment in its pipeline. The outreach to third parties and engagement with company stockholders were part of this extensive review. InvestingPro analysis shows strong growth potential, with analysts forecasting revenue growth of 58.55% for the current fiscal year. Subscribers can access 12 additional ProTips and detailed financial metrics for deeper insights.

Keros Therapeutics is known for its focus on developing protein therapeutics that could offer significant and potentially disease-modifying benefits to patients. Its lead product candidate, KER-065, is targeted at treating neuromuscular diseases, primarily Duchenne muscular dystrophy. Additionally, its advanced product candidate, elritercept (KER-050), is being developed to address cytopenias such as anemia and thrombocytopenia in patients with myelodysplastic syndrome and myelofibrosis.

The company’s decision to return capital to shareholders reflects its confidence in its ability to fund ongoing operations and research initiatives, supported by its robust liquidity position and strong financial health score as reported by InvestingPro. Keros emphasizes that this press release is not an offer to sell or a solicitation of an offer to buy any of the company’s securities.

The information provided is based on a press release statement from Keros Therapeutics, Inc.

In other recent news, Keros Therapeutics has halted the development of its drug cibotercept for pulmonary arterial hypertension following unfavorable results from the TROPOS trial. This decision is accompanied by a significant corporate restructuring, including a workforce reduction of approximately 45%, resulting in an estimated annual cost saving of $17 million. The company is also undergoing a strategic review process, which could include a potential sale, with updates expected by June 9, 2025. Meanwhile, Keros has secured support from Glass Lewis & Co. for its director nominees, despite opposition from ADAR1 Capital Management, which has criticized Keros’s governance and strategic direction. ADAR1, holding a 13.3% stake, is pushing for operational changes and urges Keros to focus on its drug candidate KER-050, developed with Takeda Pharmaceuticals. They also advocate for a significant return of capital to shareholders and a reduction in workforce by 70%. Keros plans to disclose the results of its strategic review after the Annual Meeting, a decision contested by ADAR1, which argues that stockholders need this information beforehand. The ongoing developments at Keros have drawn significant attention from investors and analysts alike.

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