M&A  December 21, 2023

SomaLogic leaders urge shareholder support of merger in face of investor opposition

BOULDER — Leaders of SomaLogic Inc. (Nasdaq: SLGC) are attempting to rally shareholder support for a planned $1 billion merger with California-based Standard BioTools Inc. (Nasdaq: LAB), even  as a major investor in the Boulder-based biotechnology company is calling for a rejection of the deal. 

Madryn Asset Management, a New York investment firm that claims to own 4.2% of SomaLogic’s outstanding shares, told shareholders this month that Madryn believes the merger to be an “inherently flawed and one-sided combination with Standard,” that “drastically undervalues SomaLogic.”

The deal, which was unanimously approved by the boards of directors of both companies, establishes a deal that will see SomaLogic shareholders receive 1.11 shares of Standard BioTools common stock for each share of SomaLogic common stock owned. When the merger is complete, SomaLogic shareholders will own approximately 57% of the combined company, and Standard BioTools shareholders will own the remainder.

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“Madryn has been an institutional investor in SomaLogic for the last seven years and has an intimate understanding of the company’s scientific know-how, total addressable market and innovative platform,” the investor said. “We strongly believe these attributes will underpin significant value creation in the quarters and years ahead.”

SomaLogic develops platforms to read thousands of proteins in a patient’s blood or urine sample that may signal illnesses or future health conditions and suggest potential treatments via machine learning.

SomaLogic went public in early 2021 through a merger with a special purpose acquisition company that added about $651 million in new funding to the company’s books and valued it at $1.23 billion. 

The road toward the merger with Standard BioTools has been a rocky one, as SomaLogic has struggled to attain profitability. The company’s stock price has shaved off more than 80% of value since the SPAC deal.

SomaLogic, in a letter sent to shareholders this week, said the deal with Standard is “a merger that we believe is in the best interests of all SomaLogic stockholders.”

The merger is expected to allow the combined company to reduce $80 million in cost redundancies. 

“Both Standard and SomaLogic have strong cost reduction momentum already; combining the two companies allows us to continue that momentum and eliminate substantial duplicative spend,” the company told shareholders. 

Madryn alleges that the merger with Standard will create conflicts of interest between the merger participants and investors.

“A cursory review of publicly available information reveals a web of connections” between parties involved in the merger decision and representatives of Casdin Capital LLC, an investor that Madryn claims has significant stakes in both Standard and SomaLogic.

SomaLogic’s letter to shareholders this week said that “it is hard to decipher the specific motivation or agenda” of Madryn. “However, it is obvious that many of their concerns are misplaced and rely on factually incorrect or deliberately misleading data.”

SomaLogic and Standard shareholders are expected to vote to consummate the merger on Jan. 4. 

BOULDER — Leaders of SomaLogic Inc. (Nasdaq: SLGC) are attempting to rally shareholder support for a planned $1 billion merger with California-based Standard BioTools Inc. (Nasdaq: LAB), even  as a major investor in the Boulder-based biotechnology company is calling for a rejection of the deal. 

Madryn Asset Management, a New York investment firm that claims to own 4.2% of SomaLogic’s outstanding shares, told shareholders this month that Madryn believes the merger to be an “inherently flawed and one-sided combination with Standard,” that “drastically undervalues SomaLogic.”

The deal, which was unanimously approved by the boards of directors of both companies, establishes a…

Lucas High
A Maryland native, Lucas has worked at news agencies from Wyoming to South Carolina before putting roots down in Colorado.
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