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Mergers and Acquisitions

Date: 2018-07-23

Type of information: Company acquisition

Acquired company: TxCell (France)

Acquiring company: Sangamo Therapeutics (USA - CA)

Amount: € 72 million

Terms:

  • • On July 23, 2018, Sangamo Therapeutics  and TxCell announced that they have entered into a definitive agreement on July 20, 2018 pursuant to which Sangamo will, following the completion of the contemplated acquisition of a majority stake of TxCell, file a simplified cash tender offer for the purchase of all then outstanding ordinary shares of TxCell, at a price of €2.58 per share in cash, or approximately € 72 million, on a debt-free and cash-free basis. Subject to satisfaction of closing conditions (including in particular those relating to regulations governing foreign investments in France), Sangamo expects to complete the transaction in the fourth quarter of 2018.
  • The filing of the cash simplified tender offer is subject to the completion of the purchase by Sangamo of TxCell ordinary shares (at a price of € 2.58 per share in cash) representing approximately 53 percent of share capital and voting rights of TxCell in accordance with the stock purchase agreement Sangamo entered into on July 20, 2018 with certain shareholders of TxCell (i.e., Mr. Stéphane Boissel who has committed to sell his shares representing less than 1 percent of the share capital and voting rights, FCPR Auriga Ventures II who has committed to sell its shares representing 16 percent of the share capital and voting rights, FCPR BIOAM who has committed to sell its shares representing 1 percent of the share capital and voting rights, FCPR BIOAM 1B who has committed to sell its shares representing less than 1 percent of the share capital and voting rights, Large Venture who has committed to sell its shares representing 10 percent of the share capital and voting rights, FCPR Innobio who has committed to sell its shares representing 15 percent of the share capital and voting rights, François Meyer who has committed to sell his shares representing less than 2 percent of the share capital and voting rights, Belsize who has committed to sell its shares representing less than 1 percent of the share capital and voting rights and YA II PN, Ltd who has committed to sell its shares representing 8 percent of the share capital and voting rights), it being specified that the completion of the sale of this majority stake is subject to conditions precedent, including in particular, those relating to regulations governing foreign investments in France and the delivery of a favorable report from HAF Audit & Conseil (represented by Mr. Olivier Grivillers), appointed as independent appraiser by TxCell’s board of directors on July 20, 2018, in compliance with sections 261-1-I and II of the General Regulation of the AMF (the French Financial Markets Authority). It is specified that the terms and conditions of the offer and the price of €2.58 per share proposed in the simplified tender offer will be subject to the independent expert's conclusion on the terms and conditions of the offer and in particular the fairness of the proposed share price and the AMF's compliance decision on the proposed offer.
  • The warrants issued by TxCell (which are not admitted for trading) will not be targeted by the cash tender offer because they will either be waived in the case of out of the money warrants, or, in the case of in the money warrants, exercised prior to the closing of the offer and the resulting shares will be either sold to Sangamo under the stock purchase agreement or tendered to the offer.
  • Subject to obtaining at least 95 percent of the share capital and voting rights of TxCell upon completion of the simplified tender offer, Sangamo would launch a squeeze-out procedure. TxCell will be a subsidiary of Sangamo operating under the name Sangamo Therapeutics SA. Following the completion of the squeeze-out procedure, Sangamo intends to delist TxCell. TxCell’s operations will remain based in Valbonne. TxCell  currently has 46 employees.

Details:

  • The proposed acquisition would combine Sangamo’s ex vivo gene editing capabilities and TxCell’s Treg expertise and would position Sangamo as a leader in CAR-Treg development. With its highly skilled and experienced team, TxCell is a leader in the emerging field of regulatory T cell (Treg) development for immunological diseases, one of Sangamo’s stated therapeutic areas of focus for its proprietary product candidate pipeline. Tregs are a naturally occurring subset of T cells and are critical for maintaining immune homeostasis within the body by induction and maintenance of tolerance to self-antigens.
  • Sangamo intends to evaluate the potential of CAR-Treg (Tregs genetically modified with a chimeric antigen receptor, or CAR) therapies to prevent graft rejection in solid organ transplant and for the treatment of autoimmune diseases such as Crohn’s disease and multiple sclerosis. Preclinical research provides proof of concept that antigen specific CAR-Tregs can deliver potent immunosuppression locally to targeted tissues. By contrast, currently available anti-TNF alpha small molecule and monoclonal antibody drugs are associated with global, non-specific immune suppression.
  • Sangamo expects that the proposed acquisition of TxCell would accelerate the company’s entry into the clinic with a CAR-Treg therapy. In 2019, Sangamo expects to submit a clinical trial authorization application in Europe for TxCell’s first CAR-Treg investigational product candidate for solid organ transplant, and to initiate a Phase 1/2 clinical trial later in the year. In addition, Sangamo intends to use its zinc finger nuclease (ZFN) gene editing technology to develop next-generation autologous and allogeneic CAR-Treg cell therapies for use in treating autoimmune diseases.

Related: Cell therapy - CAR-T - Immunological diseases

Is general: Yes