Cerevel Therapeutics agreed to combine with Nasdaq-listed special purpose acquisition company ARYA Sciences Acquisition Corp II.
The combined entity will have an expected initial market capitalization of roughly $1.3 billion. Upon closing, Arya will redomicile as a Delaware corporation and rebrand as Cerevel Therapeutics Holdings Inc. Its stock will be listed on Nasdaq under the ticker CERE. Cerevel Chairman and CEO Tony Coles will lead the combined group.
Cerevel shareholders will convert 100% of their existing equity interest into shares or equivalent awards of the combined company at an implied Cerevel equity value of $780 million. Cerevel shareholders are expected to own about 69% of the combined group upon closing, assuming no Arya shareholders elect to redeem their shares and no warrants are exercised.
Arya shareholders will convert their ordinary shares and warrants into common stock and warrants of the new entity on a 1-for-1 basis.
Institutional investors including Bain Capital LP, Perceptive Advisors LLC and Pfizer Inc. will participate in the transaction through a $320 million common stock private investment in public equity at $10 per share. Other participating investors are Adage Capital Management LP, Ally Bridge Group, Boxer Capital LLC, EcoR1 Capital LLC, Federated Hermes Kaufmann Small Cap Fund, Fidelity Management & Research Co. LLC, Invus Public Equities LP, Novalis LifeSciences Investments LLC, RA Capital Management LP, funds managed by Rock Springs Capital Management LP, Sphera Healthcare, Surveyor Capital Ltd., and funds and accounts managed by T. Rowe Price Group Inc.
Including about $150 million held in Arya's trust account, net proceeds from the transaction is expected to be approximately $445 million, which will be used to advance Cerevel's neuroscience drug pipeline.
The transaction is expected to be completed in the fourth quarter, subject to Arya shareholders' approval and other customary closing conditions.
Morgan Stanley is the lead capital markets adviser to Cerevel, with Evercore and Stifel also acting as capital markets advisers. Jefferies LLC and Goldman Sachs & Co. LLC serve as financial and capital markets advisers to Arya as well as private placement agents.
Goodwin Procter LLP is the legal counsel to Cerevel, while Kirkland & Ellis LLP is the legal counsel to Arya. Ropes & Gray LLP is the legal adviser to Bain.