The Life Sciences and Technology teams advised Surface Oncology (Nasdaq: SURF) in its entry into a definitive merger agreement with Coherus BioSciences (Nasdaq: CHRS), providing that, at the closing, Coherus will acquire Surface Oncology.
Under the terms of the agreement, Coherus will issue shares of its common stock at a price of $5.2831 per share to acquire all outstanding shares of Surface stock for a total value equal to the sum of $40 million plus Surface’s net cash at closing of the transaction (currently expected to be between $20 and $25 million). Surface shareholders will also receive contingent value rights (CVRs) for 70% of milestone and royalty-based value of existing programs with Novartis AG (NZV930) and GSK plc (GSK4381562), as well as CVRs for 25% of upfront payments made pursuant to potential ex-US licensing agreements for SRF114 and 50% of upfront payments made pursuant to potential ex-US licensing agreements for SRF388, subject to certain deductions as set forth in the contingent value rights agreement. Amounts under these CVRs are payable for a period of ten years following the closing of this transaction.
The transaction was unanimously approved by the boards of directors of both companies and is expected to close in the third quarter of 2023. The closing of the transaction is subject to certain conditions, including Surface shareholder approval; the availability at closing of at least $19.6 million of Surface cash net of short-term and long-term liabilities, transaction expenses, and other obligations; and other customary conditions.
Surface Oncology is an immuno-oncology company developing next-generation antibody therapies focused on the tumor microenvironment. Its pipeline includes two wholly-owned programs: SRF388, a Phase 2 program that targets IL-27, and SRF114, a Phase 1 program, which selectively depletes regulatory T cells in the tumor microenvironment via targeting CCR8.
The Goodwin team was led by Andrew Goodman, William Stanton, Libby Sousa, and Rivky Brandwein (Public M&A); Kingsley Taft, Stephanie Richards, Alicia Tschirhart, Brett Jackson and Amanda Rae Schwarzenbart (Corporate); Sarah Bock, Crescent Moran Chasteen, Regina Couto and Zoe Li (Executive Compensation); Christina Lewis, Jennifer Fay and Brendan Lally-McGurl (Labor & Employment); Janet Andolina, Kyle Pine and Gregg Coughlin (Tax) Timothy Kim (Debt); Arman Oruc and Simone Waterbury (Antitrust); Lauren Farruggia (FDA Regulatory); Roger Cohen, Heath Roosevelt Ingram and Jacob Lee (Healthcare); Adam Bellack and Alison Liou (IP); Jackie Klosek and Federica De Santis (Privacy); Brian Mukherjee (D&O Insurance); Morgan Mordecai (Litigation); Emily Rapalino (Litigation – IP); Chad Vella (Leasing); and Richard Matheny, Carrie Miller and Katie Dee (Global Trade).
For additional details on the merger, please read the press release.