The shares of Radius Health (NASDAQ:RDUS) surged 14% in the morning hours Thursday after the commercial stage biotech announced an agreement under which Gurnet Point Capital and Patient Square Capital will acquire the company for $890M.
The valuation includes the assumption of debt and the full payment of the CVR (Contingent Value Right) based on a sales target for osteoporosis drug TYMLOS (abaloparatide).
Per the terms, an entity co-owned by Gurnet Point and Patient Square will start a tender offer to acquire all of the outstanding shares of Radius Health (RDUS) for $10.00 in cash plus a CVR of $1.00 per share.
The CVR is subject to $300M TYMLOS net sales during any consecutive 12-month period before December 31, 2025.
The agreement indicates that the shareholders of Radius Health (RDUS) are set to receive $547M in cash, including the CVR payment.
The upfront payment implies a premium of 45% over the 30-day volume-weighted average price of the company shares.
The deal comes only days after the hedge fund manager and one of the company’s major shareholders, Rubric Capital Management, announced its support for an activist slate of board members.