Shares of F-star Therapeutics (FSTX) (DE: S4BA) surged almost 60% on June 24 after the clinical-stage biopharmaceutical company agreed to be acquired by China’s Sino Biopharmaceutical’s subsidiary invoX Pharma in an all-cash deal for $7.12 per share, or $161 million.
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Based in the UK, F-star is a clinical-stage biotech company developing next-generation immunotherapies aimed at transforming the lives of patients with cancer.
Benefits of the Deal
The addition of F-star’s unique next-generation tetravalent bispecific antibody platform will complement Sino Biopharma’s existing capabilities and further boost its global oncology pipeline.
Furthermore, it will strengthen Sino Biopharm’s International Biopharmaceutical R&D platform outside of China.
The acquisition, approved by both companies, is expected to close in the second half of 2022, subject to certain regulatory approvals.
CEO’s Comments
invoX CEO, Ben Toogood, commented: “Today’s proposed acquisition is aligned with invoX’s strategy to become a fully integrated biopharmaceutical company with an advancing pipeline of innovative products addressing unmet healthcare needs, worldwide.”
He further added, “We are excited to welcome F-star employees and look forward to working with them as we invest in the company to progress and grow its clinical pipeline to realize the full potential of the platform.”
Wall Street’s Take
Following the news, Laidlaw analyst Yale Jen downgraded F-star Therapeutics to Hold from Buy.
Jen believes that the offer price of $7.12 per share undervalues the true valuation of the shares despite recent lackluster share performance based on a “rich pipeline,” including four lead assets.
Consensus among analysts is a Hold based on 1 Buy and four Holds. The average F-star Therapeutics analyst price target of $21 implies 230.19% upside potential from current levels.
Conclusion
Within the next 10 business days, invoX will commence a tender offer to acquire all of the outstanding shares of F-star common stock.
Though the shares are currently trading at a slight discount to the offer price, the deal will most likely be completed as expected.
