Atea Pharmaceuticals (NASDAQ:AVIR) experienced a significant surge in its share price in Monday’s afternoon trading session. The rally was fueled by news of a potential takeover bid that has captured the attention of investors.
Tang Capital’s Concentra Biosciences arm made an offer to acquire Atea Pharmaceuticals, which led to the stock’s upward trajectory. The takeover bid proposed a cash payment of $5.75 per share, along with a “contingent value right” entitling the holder to 80% of net proceeds from any licenses held by Atea. However, the offer is subject to limited confirmatory due diligence and requires Atea to have $570 million in cash or cash equivalents upon closing. The deal, if finalized, is expected to be completed before the end of July 2023.
Notably, Tang Capital already holds a 3.6% stake in Atea Pharmaceuticals, indicating its confidence in the company’s potential. This move suggests that Tang Capital sees value in acquiring Atea in its entirety. Moreover, Tang Capital’s separate filing for Jounce Therapeutics (NASDAQ:JNCE) hints at its broader aspirations within the healthcare sector.
Either way, the news comes at a good time for Atea. Though there are signs that Atea Pharmaceuticals was on its way up organically, it’s clear that today’s news sent it shooting up nicely. Reaching its current price without the news from Tang Capital would have clearly taken much longer at Atea’s previous rate of growth.