M&A  January 4, 2024

SomaLogic founder, CTO among shareholders opposing Standard BioTools merger

BOULDER — Among the growing list of stakeholders who oppose SomaLogic Inc.’s (Nasdaq: SLGC) planned $1 billion merger with California-based Standard BioTools Inc. (Nasdaq: LAB) are the biotechnology firm’s founder and its chief technology officer.

Larry Gold, who founded SomaLogic in 2000 and was previously the firm’s CEO, and Jason Cleveland, its CTO since 2021, recently penned an open letter asking shareholders to join their opposition. 

“Both of us have great faith in SomaLogic’s potential,” the pair wrote. “Both of us also have serious concerns about the proposed stock-for-stock combination between the company and Standard BioTools Inc.

The merger plan, 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.

Gold and Cleveland wrote that they “believe the proposed combination is lacking in clear business rationale and shows signs of having been undertaken at the direction and for the benefit of Eli Casdin, who is a significant equity holder in both SomaLogic and Standard, and a member of the boards of directors of both companies.”

CM Life Sciences II, a special purpose acquisition company controlled by life-sciences investment group Casdin Capital LLC, merged with SomaLogic in 2021, taking the Boulder company public. 

Last month in Delaware, Gold and Cleveland filed a lawsuit against SomaLogic, Standard and Casdin, claiming that the “defendants breached their fiduciary duties of loyalty and care and approved a merger process that was rife with conflicts, transacted at an unfair price, and undertaken for the benefit of Casdin and his affiliates and to the detriment of SomaLogic stockholders.”

According to the open letter, “SomaLogic has not explained why it makes sense to subordinate the governance and economic rights of SomaLogic stockholders in the post-closing combined company. Despite the fact that SomaLogic stockholders will hold 57% of the combined company, they will only have the right to designate three directors to a seven-director board. In addition, SomaLogic stockholders will have their equity position effectively subordinated to the outsized preferred stock position held by Mr. Casdin and Casdin Capital in Standard, which will continue in place after closing.”

This week, Boston Millennia Partners, a private-equity firm that describes itself as “a significant shareholder” in SomaLogic, also came out against the Standard merger. 

Investment firms Tikvah Management LLC and Madryn Asset Management, which combined are estimated to own more than 7% of SomaLogic’s outstanding shares, have also urged a no vote on the deal. A shareholder vote is expected Thursday. 

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’s board of directors made its own pitch to shareholders this week in an attempt to drum up support for the merger. 

“The SomaLogic board believes that voting for the transaction represents the best opportunity available to maximize the value of your investment in SomaLogic,” the board said. “The transaction is the result of a months-long, thoughtful, fully informed review by our independent board. Throughout that process, the board was motivated to address the fundamental question of what is in the best interests of SomaLogic and all its stockholders.”

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 2021 SPAC deal that added about $651 million in new funding to the company’s books and valued it at $1.23 billion.

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

BOULDER — Among the growing list of stakeholders who oppose SomaLogic Inc.’s (Nasdaq: SLGC) planned $1 billion merger with California-based Standard BioTools Inc. (Nasdaq: LAB) are the biotechnology firm’s founder and its chief technology officer.

Larry Gold, who founded SomaLogic in 2000 and was previously the firm’s CEO, and Jason Cleveland, its CTO since 2021, recently penned an open letter asking shareholders to join their opposition. 

“Both of us have great faith in SomaLogic’s potential,” the pair wrote. “Both of us also have serious concerns about the proposed stock-for-stock combination between the company and Standard BioTools Inc.

The merger…

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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