ShockWave Medical to acquire Neovasc for $27.25 per share

Shockwave Medical (SWAV) announced it has entered into a definitive agreement to acquire Neovasc Inc. (NVCN). The companies said, "The Neovasc Reducer System is a first-of-its-kind technology to address refractory angina. Refractory angina is a chronic condition in which a patient suffers chest pain that cannot be controlled by conventional therapies. It is estimated that each year, in the U.S. and the E.U. alone, up to 300,000 new patients with obstructive coronary disease who are ineligible for conventional revascularization experience refractory angina, despite guideline-directed medical therapy. In addition, it is estimated that up to another 500,000 new patients present with angina and non-obstructive coronary artery disease in the U.S. and the E.U. each year. The Neovasc Reducer System has been granted Breakthrough Device designation by the FDA, is CE-marked and is currently enrolling patients in the COSIRA-II study, a randomized clinical trial being conducted under an Investigation Device Exemption intended to support U.S. FDA approval for patients with coronary obstructive refractory angina." Upon the closing of the transaction, Shockwave Medical will acquire all outstanding Neovasc shares for an upfront cash payment of $27.25 per share, corresponding to an enterprise value of approximately $100 million, inclusive of certain deal-related costs. Neovasc shareholders will also receive a potential deferred payment in the form of a non-tradable contingent value right entitling the holder to receive up to an additional $12 per share in cash if certain regulatory milestones are achieved. The upfront cash consideration represents a premium of 27% and 68% to the closing price and 30-day VWAP, respectively, of Neovasc’s common shares on the Nasdaq Capital Market on January 13, 2023. The transaction will be effected by way of a court-approved plan of arrangement pursuant to the Canada Business Corporations Act, and is subject to customary closing conditions, including requisite Neovasc shareholder approval. Shockwave expects to complete the transaction in the first half of 2023. The Board of Directors of Neovasc, acting on the unanimous recommendation of a special committee comprised of independent directors and after having received an opinion from its financial advisor to the effect that the consideration to be received by Neovasc shareholders pursuant to the plan of arrangement is fair from a financial point of view, has unanimously approved the arrangement. Directors and executive officers of Neovasc and related parties, holding an aggregate of approximately 9.23% of the Neovasc shares currently outstanding have entered into support and voting agreements with Shockwave.