Keros Announces Return of $375 Million in Excess Capital to Stockholders

Rhea-AI Summary

Keros Therapeutics (NASDAQ: KROS) has concluded its strategic alternatives review and announced plans to return $375 million in excess capital to stockholders. The company's Board of Directors unanimously approved this decision while maintaining focus on developing KER-065, their lead product candidate for neuromuscular diseases, particularly Duchenne muscular dystrophy. The strategic review process, led by the Board with assistance from outside advisors, evaluated various options including company sale, business combinations, pipeline investment, and capital return. The specific terms and structure of the capital return will be announced at a later date. Lead Independent Director Jean-Jacques Bienaimé emphasized that this decision reflects careful consideration of capital requirements, stockholder feedback, and confidence in Keros's potential to deliver meaningful therapeutic benefits to patients.

Positive

• Board approved return of significant excess capital ($375 million) to stockholders
• Company maintains development of lead product KER-065 for neuromuscular diseases
• Decision made after comprehensive strategic review with professional advisors
• Strong cash position allowing substantial return while maintaining operations

Negative

• Specific terms and structure of capital return not yet determined
• Strategic review including potential sale or business combination did not result in a transaction

Insights

Financial Strategist

Keros returning $375M to stockholders indicates excess cash position while narrowing development focus to KER-065 for neuromuscular diseases.

Keros Therapeutics has concluded its strategic alternatives review with a decisive capital allocation decision. The company plans to return $375 million in excess capital to stockholders, representing a significant financial move that speaks to both its cash position and strategic priorities. The announcement comes after what appears to be a comprehensive review process that considered multiple alternatives including a potential sale of the company, business combinations, and continued pipeline investment.

The structure and timing of this capital return remain undetermined, which leaves questions about whether it will take the form of a special dividend, share repurchase program, or another mechanism. This decision indicates the Board believes the company is overcapitalized relative to its narrowed strategic focus on developing KER-065 for neuromuscular diseases, particularly Duchenne muscular dystrophy.

This capital return decision reveals several important insights about Keros's position:

• The company likely has substantial cash reserves beyond the $375 million being returned, as they're still pursuing clinical development
• The strategic review process, which included outreach to potential acquirers, didn't result in an acceptable acquisition offer
• Management is streamlining operations to focus primarily on KER-065 rather than broader pipeline development

The move reflects both investor pressure for capital return and management's confidence in their ability to fund KER-065's development path with a leaner balance sheet. By narrowing focus while returning excess capital, Keros appears to be adopting a more capital-efficient approach to drug development while addressing shareholder demands for value creation.

Concludes Strategic Alternatives Review and Provides Update on Development of KER-065

LEXINGTON, Mass., June 09, 2025 (GLOBE NEWSWIRE) -- Keros Therapeutics, Inc. (“Keros” or the “Company”) (Nasdaq: KROS), a clinical-stage biopharmaceutical company focused on developing and commercializing novel therapeutics to treat a wide range of patients with disorders that are linked to dysfunctional signaling of the transforming growth factor-beta (“TGF-ß”) family of proteins, today announced that the Company has concluded its previously announced review process to evaluate strategic alternatives to maximize stockholder value for the Company. As a result of this process, the Company’s Board of Directors (the “Board”) unanimously determined to initiate a process to return $375 million of excess capital to stockholders. The terms and structure of this capital return remain under consideration and are expected to be announced at a future date.

Jean-Jacques Bienaimé, Lead Independent Director, said, “Our Board and management team are taking action to enhance stockholder value. To that end, we intend to return a significant amount of excess capital to stockholders while continuing to pursue development of our lead product candidate, KER-065, for the treatment of neuromuscular diseases, with an initial focus on Duchenne muscular dystrophy. This reflects a thorough review of our capital requirements, feedback from our stockholders, and our confidence in the potential for Keros to provide meaningful and potentially disease-modifying benefits to patients.”

During the strategic review process, the Board, with the assistance of the strategic committee of the Board and outside financial and legal advisors, evaluated a comprehensive range of strategic alternatives, including but not limited to a sale of the Company or other business combination transaction, continued investment in the Company’s pipeline, and/or return of excess capital to stockholders. The evaluation of these alternatives involved outreach to a number of third parties and engagement with Company stockholders.

This press release is not an offer to sell or a solicitation of an offer to buy any of the Company’s securities.

About Keros Therapeutics, Inc.

Keros is a clinical-stage biopharmaceutical company focused on developing and commercializing novel therapeutics to treat a wide range of patients with disorders that are linked to dysfunctional signaling of the TGF-ß family of proteins. Keros is a leader in understanding the role of the TGF-ß family of proteins, which are master regulators of the growth, repair and maintenance of a number of tissues, including blood, bone, skeletal muscle, adipose and heart tissue. By leveraging this understanding, Keros has discovered and is developing protein therapeutics that have the potential to provide meaningful and potentially disease-modifying benefit to patients. Keros’ lead product candidate, KER-065, is being developed for the treatment of neuromuscular diseases, with an initial focus on Duchenne muscular dystrophy. Keros’ most advanced product candidate, elritercept (KER-050), is being developed for the treatment of cytopenias, including anemia and thrombocytopenia, in patients with myelodysplastic syndrome and in patients with myelofibrosis.

Cautionary Note Regarding Forward-Looking Statements

Statements contained in this press release regarding matters that are not historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Words such as “anticipates,” “believes,” “continue,” “expects,” “enable,” “intention,” “potential” and “will” or similar expressions are intended to identify forward-looking statements. Examples of these forward-looking statements include statements concerning the intention, terms, structure and timing of return of excess capital by the Company. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties include, among others: the terms and structure of the capital return; the timing of the capital return; the risk that the capital return could have an adverse effect on the ability of the Company to retain and hire key personnel and maintain relationships with partners, suppliers, employees, stockholders and other business relationships and on its operating results and business generally; the risk of any litigation relating to the strategic review; Keros’ limited operating history and historical losses; Keros’ ability to raise additional funding to complete the development and any commercialization of its product candidates; Keros’ dependence on the success of its product candidates, KER-065 and elritercept; that Keros may be delayed in initiating, enrolling or completing any clinical trials; competition from third parties that are developing products for similar uses; Keros’ ability to obtain, maintain and protect its intellectual property; and Keros’ dependence on third parties in connection with manufacturing, clinical trials and preclinical studies.

These and other risks are described more fully in Keros’ filings with the Securities and Exchange Commission (the “SEC”), including the “Risk Factors” section of the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 6, 2025, and its other documents subsequently filed with or furnished to the SEC. All forward-looking statements contained in this press release speak only as of the date on which they were made. Except to the extent required by law, Keros undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made.

Contacts

Investor Contact:
Justin Frantz
jfrantz@kerostx.com
617-221-6042

Media Contact:
Mahmoud Siddig / Adam Pollack / Viveca Tress
Joele Frank, Wilkinson Brimmer Katcher
(212) 355-4449

FAQ

How much capital is Keros Therapeutics (KROS) returning to stockholders?

Keros Therapeutics is returning $375 million in excess capital to stockholders.

What was the outcome of Keros Therapeutics' strategic review process?

The strategic review concluded with a decision to return $375 million to stockholders while continuing development of KER-065 for neuromuscular diseases.

What is Keros Therapeutics' (KROS) main product candidate?

KER-065 is Keros' lead product candidate, being developed for neuromuscular diseases with an initial focus on Duchenne muscular dystrophy.

When will Keros announce the structure of the $375 million capital return?

The specific terms and structure of the capital return are still under consideration and will be announced at a future date.

What options did Keros consider during its strategic review?

Keros evaluated options including a company sale, business combination transactions, continued pipeline investment, and return of excess capital to stockholders.