Sigilon Therapeutics (NASDAQ:SGTX) stock is rocketing on Thursday morning after Eli Lilly (NYSE:LLY) agreed to acquire the company.
The acquisition will see Eli Lilly pay $14.92 per share in cash and one tradeable contingent value right for each share of SGTX stock. That contingent value right has a value of $111.64 per share in cash, which brings the total offer for SGTX stock to $126.56 per share.
The contingent value rights in the deal pay out cash to investors based on milestones. That includes $4.06 per share for the first dosing of the first human clinical trial, $26.39 per share for the first dosing in a human trial for registration purposes, as well as $81.19 per share for regulatory approval.
All of these are connected to the company’s encapsulated cell therapies that it has been developing with Eli Lilly. Of particular note is SIG-002, which is a treatment for Type 1 diabetes. The goal of these therapies is “sensing blood glucose levels, restoring insulin production and releasing it over the long term.”
Timing and Approval for the SGTX Stock Deal
Sigilon Therapeutics and Eli Lilly are expecting the acquisition deal to go into effect in the third quarter of 2023. There is no financing condition for the deal, but it will require support from SGTX stockholders. Sigilon Therapeutics’ board of directors has already given its unanimous support to the deal and advises investors to take part in the tender offer.
SGTX stock is up 691.1% as of Thursday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
