XenoTherapeutics completes acquisition of ESSA Pharma

SOUTH SAN FRANCISCO/VANCOUVER - XenoTherapeutics has completed its previously announced acquisition of ESSA Pharma Inc. (NASDAQ:EPIX), the companies announced Thursday. The deal comes as ESSA’s shares have declined over 70% in the past year, with the company’s market capitalization standing at approximately $9.5 million.

Under the terms of the deal, Xeno Acquisition Corp., a wholly owned subsidiary of XenoTherapeutics, acquired all outstanding common shares of ESSA for approximately $0.1242 per share, significantly below its 52-week high of $6.45. Shareholders also received one contingent value right (CVR) per share, which may provide up to an additional $0.14 per share depending on the outcome of certain contingent liabilities. According to InvestingPro data, ESSA maintains strong liquidity with a current ratio of 69.07.

The potential CVR payment represents up to $6.7 million in aggregate that could be distributed to CVR holders.

The Supreme Court of British Columbia approved the arrangement on October 7. ESSA has requested that Nasdaq file a delisting application for its common shares and expects to terminate the registration of its shares under the U.S. Securities Exchange Act approximately 10 days after the closing of the acquisition.

Leerink Partners LLC served as ESSA’s exclusive financial advisor for the transaction, while Blake, Cassels & Graydon, LLP and Skadden, Arps, Slate, Meagher & Flom LLP acted as the company’s Canadian and U.S. legal counsel, respectively.

ESSA Pharma was previously focused on developing therapies for the treatment of prostate cancer. XenoTherapeutics is a Massachusetts-based research foundation focused on advancing xenotransplantation through scientific research, clinical development, and public education. InvestingPro analysis reveals that ESSA holds more cash than debt on its balance sheet, with 11 additional key insights available to subscribers.

The information in this article is based on a company press release statement.

In other recent news, ESSA Pharma Inc. has announced several significant developments. The company received overwhelming approval from its securityholders for its acquisition by XenoTherapeutics Inc., with a 99.85% approval rate including options and pre-funded warrants. This merger has been further advanced with court approval from the Supreme Court of British Columbia, allowing the special meeting to proceed as scheduled. However, ESSA Pharma has revised the terms of its merger with XenoTherapeutics, significantly reducing the expected payout to shareholders from $1.91 to approximately $0.12 per share. Additionally, shareholders will receive a non-transferable contingent value right (CVR) with a potential value of up to $0.14 per CVR depending on certain outcomes.

In an effort to return value to its shareholders, ESSA Pharma plans to distribute $80 million as part of its winding-up process. This distribution has been authorized by the Supreme Court of British Columbia and is set for payment on August 22. These developments mark a pivotal moment for ESSA Pharma as it transitions through this merger process.

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