Otsuka Pharmaceutical Co., Ltd.’s (TYO: 4578) wholly-owned subsidiary Otsuka America, Inc. will acquire Mindset Pharma Inc. (CSE: MSET) (FSE: 9DF) (OTCQB: MSSTF) for around $80 million.
The acquisition was announced on Thursday and it will be an all-cash transaction and is expected to close on Oct. 19 subject to approval and other conditions.
Financially, the deal appears to be a win-win for both parties. Each Mindset shareholder will receive $0.75 in cash for each share held, representing a 15.4 per cent premium to the closing price of Mindset shares on August 30.
Holders of outstanding options and warrants to purchase shares of Mindset will also receive a cash payment for the “in-the-money” value.
James Lanthier, CEO of Mindset, was enthusiastic about the deal, stating that the all-cash transaction maximizes value and is a great outcome for all Mindset stakeholders.
“We believe Otsuka is ideally positioned to maximize the value of the Mindset assets and IP portfolio to the future benefit of patients,” Mindset CEO James Lanthier said.
$MSET's exclusive partnership with Otsuka Pharmaceuticals is the sole psychedelic-big pharma alliance in this field.
CEO James Lanthier sheds light on our strategy to advance this collaboration and Otsuka's research focus.https://t.co/tP8eOqNfAP— Mindset Pharma Inc. (@MindsetPharma) August 25, 2023
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The transaction still has to clear some regulatory hurdles. It is subject to approval by at least two-thirds of the votes cast by the shareholders of Mindset and a simple majority of votes excluding “related parties” and “interested parties.”
A special meeting for Mindset security holders is scheduled to take place in October 2023 to vote on the transaction. The deal has been unanimously approved by the respective boards of Otsuka and Mindset.
“Otsuka Pharmaceutical has designated psychiatry and neurology as one of its top priority therapeutic areas and has been developing antipsychotic agents with clinical significance on a global basis,” Otsuka president Makoto Inoue said in a statement.
“With the addition of Mindset’s novel compounds and synthesis processes, we expect this acquisition will further contribute to the treatment of patients suffering from psychiatric disorders.”
Read more: Mindset Pharma discovers 3 novel next-gen psychedelic compounds
Read more: Mindset Pharma develops patent-pending new technology
Otsuka Pharmaceutical is a global healthcare company with a focus on pharmaceutical products to meet unmet medical needs and nutraceutical products for the maintenance of everyday health. The company had consolidated sales of approximately USD$13.1 billion in 2022.
Otsuka stock lightly went up by 1 per cent to ¥5,546 on the Tokyo Stock Exchange.
On the other hand, Mindset Pharma stock, which is a company focused on psychedelic medicines to treat neurological and psychiatric disorders, saw a 10.77 per cent raise to $0.72 on the Canadian Securities Exchange.
Natalia@mugglehead.com
