Just 10 months after abandoning its second effort to go public, Aldagen is selling out to a small regenerative medicine company for just $16 million in shares and the chance to earn another chunk of stock based on the clinical success of its stem cell therapies.
The news isn't likely to spur much joy among its investors. Durham, NC-based Aldagen reportedly raised more than $60 million from venture groups, a list that includes Aurora Funds, Intersouth Partners, Harbert Venture Partners, CNF Investments and Tullis-Dickerson. They agreed to buy $5 million of shares in the acquiring company, Cytomedix, to help fund a Phase II study of their lead stroke treatment. And if the trial is successful they stand to earn the lion's share of 20 million shares of Gaithersburg, MD-based Cytomedix held out in milestones.
The buyout--which hands 17% of Cytomedix ($CMXI) to Aldagen shareholders upfront--will allow Cytomedix to expand its work in the regenerative medicine field. And the CEO--who saw Cytomedix shares jump 9% on the news this morning--had no qualms touting the bargain price on the deal.
"We view the acquisition of Aldagen as an opportunistic transaction at an attractive valuation that will allow us to build and expand our new product development efforts with Aldagen's technology, intellectual property, people and clinical expertise," says Martin P. Rosendale. "In terms of maximizing opportunity for our shareholders while managing and mitigating risk, we feel this transaction is very advantageous."
Aldagen has several development programs underway for its adult stem cell technology. Its strategy is focused on the regenerative powers of stem cells that express ALDH enzymes. Its investigators have been working on stroke, critical limb ischemia and other programs.
- here's the press release
- read the story from the News & Observer