Full Press Release Details
Ligand to Spin-Off its OmniAb Business Through
Avista Public Acquisition Corp. II
Transaction will result in OmniAb becoming an
independent publicly traded company
Ligand's shareholders to receive 100%
of Ligand's shares in OmniAb through a tax-free distribution immediately prior to the merger
CALIFORNIA and NEW YORK (March 23, 2022) - Ligand Pharmaceuticals Incorporated (Ligand) (NASDAQ: LGND) today
announced the signing of a definitive merger agreement with Avista Public Acquisition Corp. II (APAC) (NASDAQ: AHPA), a publicly traded
special purpose acquisition company (SPAC), providing for the spin-off of OmniAb, Inc. (OmniAb), Ligand's antibody discovery
business, immediately followed by a merger with a newly formed subsidiary of APAC. The combined company will be led by Ligand's
President, Matt Foehr, and will be renamed "OmniAb, Inc."
Upon the closing of the transaction, Avista Capital
Partners (Avista), APAC's sponsor and a leading private equity firm focused on the healthcare industry, has agreed to invest up
to $115 million in the combined company, and Ligand will contribute $15 million. The combined company will have an initial pre-money equity
valuation of $850 million. Immediately prior to the transaction close, Ligand intends to distribute 100% of its ownership of OmniAb to
Ligand shareholders in a tax-free distribution. The transaction is expected to close in the second half of 2022.
Ligand's OmniAb antibody discovery platform
provides pharmaceutical industry partners with access to diverse antibody repertoires and high-throughput screening technologies to enable
discovery of next-generation therapeutics. At the heart of the OmniAb platform is the Biological Intelligence (BI) of
its proprietary transgenic animals including OmniRat, OmniChicken and OmniMouse, which have been genetically modified to generate antibodies
with human sequences to facilitate the development of human therapeutic candidates. Over 55 partners currently have access to OmniAb-derived
antibodies and more than 250 programs are being actively developed or commercialized. In 2021, nine antibodies derived from the OmniAb
platform entered clinical testing and two royalty-bearing antibodies received regulatory approvals.
"In late 2021, Ligand's Board of
Directors decided to separate Ligand into two public companies given the growth prospects and needs of our various proprietary
technology platforms, and to unlock value to Ligand's shareholders," said John Higgins, CEO of Ligand. "We
considered multiple ways to pursue a separation with the goals of ensuring a smooth transition of operations, a healthy balance
sheet for both OmniAb and Ligand, and strong market sponsorship. As we were preparing for a first-half 2022 direct spin-off of
OmniAb to Ligand's shareholders, as discussed on our recent earnings call, we received an offer from Avista to merge OmniAb
with their SPAC. The Avista team is comprised of high-quality healthcare operators and investors with an excellent track record.
They have done extensive due diligence and see the potential and value of OmniAb, a highly competitive, leading platform with strong
momentum given recent major clinical and regulatory successes. We are very pleased to partner with APAC and its shareholders to take
OmniAb to the next level."
"The OmniAb business is positioned for continued
growth and success as we provide partners with access to diverse antibody repertoires and cutting-edge high-throughput screening technologies
that enable the discovery of next-generation therapeutics," said Mr. Foehr. "Two OmniAb-derived antibodies recently received
regulatory approvals in China and a third approval is expected in the United States later this year. Our growing roster of partners and
new programs illustrates the value our technology offers. We are excited to join forces with Avista to further build and expand our differentiated
capabilities with applicability to a variety of modalities, and to leverage our technical strengths to become the industry's partner
David Burgstahler, CEO of APAC, added, "OmniAb's
merger with APAC and its subsequent status as a standalone public company will help propel the company toward a new phase of growth and
value creation. The merger will empower OmniAb with access to the capital markets, strong cash reserves, the agility to drive innovation
and a superb leadership team. We look forward to partnering with Matt and the entire organization as they continue to differentiate OmniAb
as a critical partner in advancing drug discovery and development."
Matt Foehr will lead OmniAb as CEO and will resign
from his role as Ligand's President and COO at closing. Kurt Gustafson has joined the OmniAb management team as CFO, bringing over
25 years of diverse experience in corporate finance and senior management roles in growth-oriented publicly traded biopharmaceutical companies,
most recently as CFO of Spectrum Pharmaceuticals. Mr. Gustafson previously served as CFO of Halozyme Therapeutics and held senior
finance roles at Amgen.
The combination of OmniAb and AHPA is structured
to guarantee a minimum of $130 million in gross cash to the combined company at the time of closing, and up to $266 million in the event
of no redemptions by APAC shareholders. APAC's shareholders will be eligible to participate in the transaction or to elect redemption
of their shares. Avista has agreed to guarantee that Avista and AHPA will provide at least $115 million of gross cash to the combined
company through a $15 million PIPE investment and a $100 million facility to backstop potential redemptions. Ligand's $15 million
contribution to OmniAb will be made irrespective of the number of redemptions or the Avista contributions.
Ligand intends to distribute 100% of the equity
in OmniAb to Ligand shareholders immediately prior to the business combination with APAC. The transaction will be effected through a "Reverse
Morris Trust" transaction pursuant to which OmniAb will be spun-off to Ligand's shareholders and simultaneously merged as
a subsidiary of APAC. The transaction is expected to be tax-free to Ligand and its shareholders for U.S. federal income tax purposes,
except for cash received in lieu of fractional shares. Upon the closing of the transaction, Ligand shareholders are expected to own approximately
75% to 84% of the combined company, depending on redemptions, which will be listed on the Nasdaq Global Markets under the ticker symbol
The Boards of Directors of both APAC and Ligand
have unanimously approved the proposed transaction, which is subject to customary closing conditions, including receipt of required regulatory
approvals and receipt of approval from APAC's shareholders.
Credit Suisse is acting as lead capital markets and financial advisor to OmniAb, Cowen, Stifel, SVB Leerink and Truist Securities are
also acting as capital markets and financial advisors to OmniAb, and CJS Securities, Craig-Hallum Capital Group LLC, H.C. Wainwright &
Co. and Roth Capital Partners are acting as advisors to OmniAb. Weil, Gotshal & Manges LLP is legal advisor to APAC. Latham &
Watkins LLP is legal advisor to Ligand.
information about the transaction will be provided in a Current Report on Form 8-K to be filed by APAC with the Securities and Exchange
Commission (SEC) and will be available on the SEC's website at www.sec.gov.
Following the completion of this transaction,
OmniAb will consist of the OmniAb discovery platform featuring transgenic animals that have been genetically modified to generate antibodies
with human sequences to facilitate development of human therapeutic candidates, as well as the Icagen ion channel technology. Ligand Pharmaceuticals'
platform technologies will consist of the Captisol technology, a patent-protected, chemically modified cyclodextrin with
a structure designed to optimize the solubility and stability of drugs, and the Pelican Expression Technology , a robust,
validated, cost-effective and scalable platform for recombinant protein production that is especially well-suited for complex, large-scale
The OmniAb discovery platform provides pharmaceutical
industry partners with access to diverse antibody repertoires and high-throughput screening technologies to enable discovery of next-generation
therapeutics. At the heart of the OmniAb platform is the Biological Intelligence (BI) of our proprietary transgenic animals, including
OmniRat, OmniChicken and OmniMouse, which have been genetically modified to generate antibodies with human sequences to facilitate development
of human therapeutic candidates. OmniFlic (transgenic rat) and OmniClic (transgenic chicken) address industry needs for bispecific antibody
applications though a common light chain approach, and OmniTaur features unique structural attributes of cow antibodies for complex targets.
OmniAb animals comprise the most diverse host systems available in the industry and they are optimally leveraged through computational
antigen design and immunization methods, paired with high-throughput microfluidic-based single B cell screening and deep computational
analysis of next-generation sequencing datasets to identify fully human antibodies with superior performance and developability characteristics.
An established core competency focused on ion channels and transporters further differentiates our technology and creates opportunities
to further leverage across modalities, including antibody-drug conjugates and others. The OmniAb suite of technologies and differentiating
computational capabilities and BI features are combined to offer a highly efficient and customizable end-to-end solution for the growing
discovery needs of the global pharmaceutical industry. For more information, please visit www.omniab.com.
About Avista Public Acquisition Corp. II
is a special purpose acquisition company that completed its initial public offering in August 2021. APAC was formed for the purpose
of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or business combination with one or
more businesses. APAC is sponsored by Avista Acquisition LP II, which was formed for the express purpose of acting as the sponsor for
APAC. Avista Acquisition Corp. is an affiliate of Avista Capital Holdings, L.P. For more information, please visit www.avistapac.com/ahpac.
is a biopharmaceutical company focused on developing or acquiring technologies that help pharmaceutical companies discover and develop
medicines. Our business model creates value for shareholders by providing a diversified portfolio of biotech and pharmaceutical product
revenue streams that are supported by an efficient and low corporate cost structure. Our goal is to offer investors an opportunity to
participate in the promise of the biotech industry in a profitable, diversified and lower-risk business than a typical biotech company.
Our business model is based on doing what we do best: drug discovery, early-stage drug development, product reformulation and partnering.
We partner with other pharmaceutical companies to leverage what they do best (late-stage development, regulatory management and commercialization)