Halozyme Confirms Proposal to Combine with Evotec for €11.00 Per Share in an All-Cash Transaction

Rhea-AI Summary

Halozyme (NASDAQ: HALO) has submitted a non-binding proposal to acquire Evotec SE (NASDAQ: EVO) for €11.00 per share in cash, valuing the company at €2.0 billion. The offer represents a 109% premium to Evotec's share price on October 15, 2024, and a 77% premium to its three-month volume weighted average price.

The proposed combination aims to create a global innovative services company, integrating Evotec's drug discovery platform and Just – Evotec Biologics manufacturing capabilities with Halozyme's ENHANZE® technology. The merger would diversify and extend Halozyme's revenue and EBITDA growth well into the next decade, with no financing contingency required for the transaction.

Positive

• Significant premium offered: 109% above Evotec's undisturbed share price
• Transaction fully backed by Halozyme's cash reserves and strong balance sheet
• Expected to diversify and extend revenue and EBITDA growth
• Strategic expansion into biologics manufacturing and drug discovery platforms
• Potential for expanded partnership opportunities with broader technology offerings

Negative

• Non-binding proposal indicates uncertainty in deal completion
• Large cash outlay of €2.0 billion could impact Halozyme's financial flexibility

Insights

M&A Specialist

This proposed acquisition represents a significant strategic move for Halozyme, offering a €2.0 billion all-cash deal at €11.00 per share for Evotec. The premium of 109% to Evotec's undisturbed share price is notably high, signaling Halozyme's strong commitment to the deal. The transaction would create substantial synergies by combining Halozyme's ENHANZE technology with Evotec's biologics manufacturing and drug discovery platforms.

The deal structure appears solid with Halozyme's confirmed cash reserves and no financing contingency, reducing execution risk. The merger would significantly diversify Halozyme's revenue streams and enhance its EBITDA growth potential. Key value drivers include:

• Integration of complementary biological platforms
• Expanded geographic presence across US and Europe
• Enhanced drug discovery capabilities
• Improved manufacturing capabilities for biologics

Biotech Industry Analyst

The strategic rationale for this acquisition is compelling from a technological perspective. The combination would create a powerhouse in biologics development and delivery, merging Halozyme's ENHANZE® platform with Evotec's Just Biologics manufacturing capabilities. This integration could significantly reduce the cost of biological drug production while improving delivery mechanisms.

The merger would position the combined entity as a more comprehensive partner for pharmaceutical companies, offering end-to-end solutions from drug discovery through delivery. The emphasis on making Evotec's platform the Center of Excellence for drug discovery suggests a well-thought-out integration strategy that could accelerate innovation in the biologics space.

Combination Would Create a Global Innovative Services Company with a Unique Set of Differentiated Technologies, a Deep Pipeline, and Best-in-class Industry Team

SAN DIEGO, Nov. 14, 2024 /PRNewswire/ -- Halozyme Therapeutics, Inc. (NASDAQ: HALO) ("Halozyme" or the "Company") confirmed it has submitted a non-binding proposal to the Management Board and Supervisory Board of Evotec SE (NASDAQ: EVO) ("Evotec") to acquire Evotec for €11.00 per share in cash, implying a fully diluted equity value of €2.0 billion. The proposal represents a premium of 109% to Evotec's undisturbed share price on October 15, 2024, the day prior to Triton Partners' initial accumulation of Evotec shares, and a premium of 77% to Evotec's last three-month volume weighted average price on October 15, 2024.

"The combination of Halozyme and Evotec would diversify and extend Halozyme revenue and EBITDA growth and durability well into the next decade and beyond," said Helen Torley, president and chief executive officer of Halozyme. "I am excited about the potential to bring together best-in-class innovative technologies and both organizations' capabilities to create a pan U.S. / European innovative services company. With increased scale, a deep pipeline, and a diversified offering, we would be a highly attractive strategic partner to the biopharma industry. This in turn would provide a remarkable opportunity to accelerate the discovery and development of medicines that will improve patients' outcomes."

Halozyme believes that the proposed combination would create a global innovative services company with:

• Innovation Driven Platform: Evotec's drug discovery platform would become the Center of Excellence within Halozyme for all drug discovery business.
• Expanded Biologic Platforms: Just – Evotec Biologics, a fast-growing, best-in-class biologic manufacturing platform with the potential to expand the worldwide supply of biologic products more affordably, would complement Halozyme's ENHANZE^® drug delivery technology for large volume biologics.
• Accelerated Growth: Halozyme's strong cash generation would support continued reinvestment into Evotec's earlier stage programs and new technologies. Additionally, Halozyme's proven track record of translating innovative technologies into businesses that improve patients' outcomes would result in an opportunity to accelerate the development of new treatments.
• Compelling Financial Upside: The combination would be expected to meaningfully diversify, scale and extend Halozyme revenue and EBITDA well into the next decade and later. The diversified technology offerings of the proposed combination would create opportunities to expand programs with a broader set of partners.

Halozyme has significant cash reserves on-hand and a strong balance sheet. Closing of the transaction would not be subject to any financing contingency and would meet the requirements of BaFin in relation to financing of an offer.

Advisors

Centerview Partners is serving as Halozyme's financial advisor and Weil, Gotshal & Manges LLP, as legal advisor.

About Halozyme

Halozyme is a biopharmaceutical company advancing disruptive solutions to improve patient experiences and outcomes for emerging and established therapies. As the innovators of ENHANZE^® drug delivery technology with the proprietary enzyme rHuPH20, Halozyme's commercially-validated solution is used to facilitate the subcutaneous delivery of injected drugs and fluids, with the goal of improving the patient experience with rapid subcutaneous delivery and reduced treatment burden. Having touched more than 800,000 patient lives in post-marketing use in eight commercialized products across more than 100 global markets, Halozyme has licensed its ENHANZE^® technology to leading pharmaceutical and biotechnology companies including Roche, Takeda, Pfizer, Janssen, AbbVie, Eli Lilly, Bristol-Myers Squibb, argenx, ViiV Healthcare, Chugai Pharmaceutical and Acumen Pharmaceuticals.

Halozyme also develops, manufactures and commercializes, for itself or with partners, drug-device combination products using its advanced auto-injector technologies that are designed to provide commercial or functional advantages such as improved convenience, reliability and tolerability, and enhanced patient comfort and adherence. The Company has two commercial proprietary products, Hylenex^® and XYOSTED^®, partnered commercial products and ongoing product development programs with Teva Pharmaceuticals and Idorsia Pharmaceuticals.

Halozyme is headquartered in San Diego, CA and has offices in Ewing, NJ and Minnetonka, MN. Minnetonka is also the site of its operations facility.

For more information visit www.halozyme.com and connect with us on LinkedIn and Twitter.

Forward-Looking Statements

In addition to historical information, the statements set forth in this press release include forward-looking statements including, without limitation, statements concerning the Company's future plans, objectives, expectations and intentions relating to a potential transaction concerning Evotec, such potential transaction's expected impact and contributions to the Company's and the combined group's operations and financial results, the financing and closing of such potential transaction, as well as the expected timing and benefits of such potential  transaction, the Company's and Evotec's future product development and regulatory events and goals, product collaborations, the Company's business intentions and financial statements and anticipated results.  These forward-looking statements are typically, but not always, identified through use of the words "expect," "believe," "enable," "may," "will," "could," "intends," "estimate," "anticipate," "plan," "predict," "probable," "potential," "possible," "should," "continue," and other words of similar meaning and involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Actual results could differ materially from the expectations contained in these forward-looking statements as a result of several factors, including  uncertainties concerning future matters such as market conditions, changes in domestic and foreign business changes in the competitive environment in which the Company and Evotec operate, discussions with Evotec and its board of directors, and financing a potential transaction, inability of the parties to successfully or timely enter into or consummate a transaction, including the risk that any required regulatory approvals are not obtained, are delayed or are subject to unanticipated conditions that could adversely affect the combined group or the expected benefits of a transaction, unexpected levels of the combined group's revenues, expenditures and costs, unexpected results or delays in the growth of the combined group's business, or in the development, regulatory review or commercialization of the combined group's partnered or proprietary products, regulatory approval requirements, unexpected adverse events or patient outcomes and competitive conditions. These and other factors that may result in differences are discussed in greater detail in the Company's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission. Except as required by law, the Company undertakes no duty to update forward-looking statements to reflect events after the date of this release.

Halozyme Contacts

Investors
Tram Bui
Halozyme VP, Investor Relations and Corporate Communications
609-359-3016
tbui@halozyme.com

U.S. Media
Andrea Calise
Teneo
917-826-3804
andrea.calise@teneo.com 

Christina Coronios
Teneo
646-531-2882
christina.coronios@teneo.com 

German Media
Felix Schoenauer
Teneo
+49 69 867906054
Press-halo@teneo.com 

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SOURCE Halozyme Therapeutics, Inc.

FAQ

What is the acquisition price offered by Halozyme (HALO) for Evotec shares?

Halozyme (HALO) offered €11.00 per share in cash for Evotec, implying a total equity value of €2.0 billion.

What premium does Halozyme's (HALO) offer represent to Evotec's share price?

The offer represents a 109% premium to Evotec's share price on October 15, 2024, and a 77% premium to its three-month volume weighted average price.

What are the main strategic benefits of Halozyme's (HALO) proposed acquisition of Evotec?

The combination would create a global innovative services company, combining Evotec's drug discovery platform and biologics manufacturing with Halozyme's ENHANZE technology, while diversifying and extending revenue and EBITDA growth.