CM Life Sciences (NASDAQ:CMLF) stock is soaring higher on Wednesday after announcing plans to take Sema4 public via a special purpose acquisition company (SPAC) merger.

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Here’s everything investors need to know about the companies and the upcoming SPAC merger.

• CM Life Sciences is a company created by affiliates of Casdin Capital, LLC and Corvex Management LP.
• The company’s’ goal is to bring together other companies in the life science sector, which it says suffers from fragmentation.
• Sema4 is a clinical data company that uses artificial intelligence (AI) to help bring patients’ data together.
• Its focus is on ‘transforming healthcare by building dynamic models of human health and defining optimal, individualized health trajectories.”
• The SPAC merger deal will also result in a change to the company’s name, as well as for CMLF stock.
• However, a final name and ticker for the combined company haven’t been announced yet.
• The SPAC merger sets an enterprise value of $2 billion.

• It also includes gross proceeds of $793 million for Sema4 after the deal closes.
• That comes from $443 million in cash held by CM Life Sciences from its initial public offering (IPO) in September 2020.
• The other $350 million is being provided by private investment in public equity (PIPE).
• The SPAC merger will see holders of Sema4 stock receive shares of CMLF stock and up to $343 million for their shares.
• Sema4 expects to have $500 million in cash available after the deal to fund operations.
• The deal is set to close in the second quarter of 2021.

CMLF stock was up 38.5% as of Wednesday morning.

On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article.