Madryn Asset Management Reiterates Alternative Path to SomaLogic’s Value-Destructive Proposed Merger with Standard BioTools
Madryn Asset Management, LP (Madryn) reiterates its view that there is a viable alternative to the proposed merger between SomaLogic, Inc. (SLGC) and Standard BioTools Inc. (LAB). They believe that SomaLogic's cash position and near-term commercial opportunities mitigate the need for the merger, and they urge shareholders to vote against it.
Positive
Madryn's proposal outlines potential steps for SomaLogic to resolve litigation and shareholder disputes, refresh the board, install a commercially focused management team, implement operational enhancements, and consider strategic alternatives on an appropriate timeline.
They highlight the inaccuracies and omissions in the ISS report recommending 'cautionary support' for the merger and express their commitment to helping SomaLogic pursue a better path forward.
Negative
The proposal raises concerns about the flawed and highly conflicted process resulting in the proposed merger, and the potential negative impact on shareholder value.
Terminating the merger may lead to costly, distracting, and time-consuming conflicts, which could affect the company's operations and financial performance.
A critical examination of the current situation surrounding SomaLogic, Inc. reveals significant strategic considerations for the company and its shareholders. The opposition to the Proposed Merger with Standard BioTools Inc. reflects concerns over the potential for value destruction, suggesting that the deal may not adequately capitalize on SomaLogic's financial and commercial position. The call for a refreshed Board and management team underscores the need for experience and a track record of success in leading life sciences companies, which could be pivotal in navigating the competitive landscape and leveraging the company's assets, such as its cash reserves and commercial opportunities.
The proposed steps by Madryn Asset Management, such as resolving litigation, refreshing the Board, installing a commercially focused management team, implementing operational enhancements and considering strategic alternatives, are aimed at realigning the company's strategy to focus on long-term shareholder value. These steps could potentially improve operational efficiency and market positioning. However, the success of these initiatives largely depends on the execution capabilities of the new leadership and the Board's effectiveness in strategic decision-making.
Investors should monitor the situation closely as the resolution of these issues and the potential cancellation of the merger could have a material impact on the company's stock price and future prospects.
The mention of ongoing litigation and shareholder disputes highlights legal risks that could have financial implications for SomaLogic. Resolving these issues is presented as a necessary step to eliminate distractions and avoid further costs, which could otherwise impede the company's ability to operate effectively. The legal complexities associated with corporate governance, such as the composition and refreshment of the Board, also play a crucial role in the company's ability to navigate its current challenges and implement its proposed strategic plan.
From a legal perspective, the integrity of the decision-making process and the independence of the Board are paramount in ensuring that the company's actions align with shareholder interests. The emphasis on the need for non-conflicted directors to evaluate future transactions suggests a focus on corporate governance best practices, which could enhance investor confidence if properly executed.
The life sciences sector is highly competitive and rapidly evolving, with a significant emphasis on innovation and commercialization. SomaLogic's strategy, as suggested by Madryn Asset Management, appears to be pivoting towards leveraging its existing assets and enhancing operational efficiency. The distributed kit pilot with Illumina, Inc. is an example of the company's efforts to make commercial progress. The success of such initiatives could be instrumental in defining SomaLogic's market position and future growth trajectory.
The call for a commercially focused management team and the consideration of strategic alternatives on an appropriate timeline reflect the importance of agility and strategic foresight in the life sciences industry. These steps, if implemented effectively, could allow SomaLogic to capitalize on its technological capabilities and market opportunities, potentially leading to increased shareholder value.
12/22/2023 - 08:00 PM
Preliminary Review of ISS Report, Which Recommends “Cautionary Support” for the Proposed Merger, Indicates It Contains Factually Inaccurate Information and Does Not Align with Prior Contested Transaction Recommendations
Urges Shareholders to Vote “AGAINST ” the Proposed Merger with Standard BioTools
NEW YORK --(BUSINESS WIRE)--
Madryn Asset Management, LP (“Madryn Asset Management” and, collectively with its affiliates, “Madryn” or “we”), a holder of approximately 4.2% of the outstanding common stock of SomaLogic, Inc. (“SomaLogic” or the “Company”) (Nasdaq: SLGC), today reiterated its view that there is a viable alternative to the proposed merger (the “Proposed Merger”) with Standard BioTools Inc. (Nasdaq: LAB). Madryn issued the following statement:
It is our view that SomaLogic’s considerable cash position and near-term commercial opportunities mitigate the need for the Company to enter into a value-destructive combination that we believe is the result of a flawed and highly conflicted process. Now that SomaLogic’s Board of Directors (the “Board”) has learned of the growing shareholder opposition to the Proposed Merger, it should consider the future if the deal is terminated. Madryn believes the following steps can be the foundation for a much brighter future for SomaLogic and its shareholders:
Resolve Litigation and Shareholder Disputes – Terminating the Proposed Merger will pave the way to resolving costly, distracting and time-consuming conflicts, including litigation brought by the Company’s founder and Chief Technology Officer. We suspect that a termination of the Proposed Merger will facilitate a global resolution to these ongoing issues.
Refresh the Board in a Methodical Way – We remain open to working collaboratively with the Board to initiate a timely refresh to replace three legacy directors with three highly qualified individuals designated and endorsed by shareholders. Through their recent actions, several members of the incumbent Board have lost our trust and should recognize the need to engage amicably and directly on necessary changes.
Install a Commercially Focused Management Team – Along with a refreshed Board, the Company needs to install a permanent Chief Executive Officer and permanent Chief Financial Officer, each with experience leading successful life sciences companies. Long-term investors, such as Madryn, can leverage their own industry networks to suggest candidates that can be included in the Board’s search process (which we expect would involve retaining a leading independent search firm as well as considering Interim CEO Adam Taich).
Implement Operational Enhancements – Based on the Company’s updates, SomaLogic continues to make commercial progress ahead of its distributed kit pilot with Illumina, Inc.1 (Nasdaq: ILMN). Additionally, the Company has implemented several cost savings initiatives.2 New management must continue to focus on these two fronts to drive long-term shareholder value.
Consider Strategic Alternatives on an Appropriate Timeline – Once the steps detailed above are underway, we believe that the Company will be in a stronger position to obtain full and fair value via a future transformative transaction. A refreshed Board and a Transaction Committee composed of truly independent, non-conflicted directors – including individuals who bring shareholder perspectives – will be properly equipped to evaluate any and all potential alternatives for the Company to maximize value.
Additionally, we note that Institutional Shareholder Services, Inc. (“ISS”) has issued a seemingly flawed report that recommended “cautionary support” for the Proposed Merger. Based upon a preliminary review, we believe that the ISS report contains inaccurate information and omissions, and that it is inconsistent with past recommendations. We intend to issue a communication in the near-term that lays these issues out.
We remain committed to helping SomaLogic pursue a better path forward and stand willing to engage with the Board to reach a superior outcome that is in the best interests of all shareholders.
Voting “AGAINST ” the Proposed Merger Will Protect the Value of Shareholders’ Investment and Allow SomaLogic to Pursue Vastly Superior Alternatives
Visit www.NoSomaLogicMerger.com for Additional Information
About Madryn Asset Management
Madryn Asset Management is a leading alternative asset management firm that invests in innovative healthcare companies specializing in unique and transformative products, technologies and services. The firm draws on its extensive and diverse experience spanning the investment management and healthcare industries and employs an independent research process based on original insights to target attractive economic opportunities that deliver strong risk-adjusted and absolute returns for its limited partners while creating long-term value in support of its portfolio companies.
IMPORTANT ADDITIONAL INFORMATION
Madryn Asset Management, Madryn Health Partners, LP, Madryn Health Partners (Cayman Master), LP, Madryn Health Advisors, LP, Madryn Health Advisors GP, LLC, Madryn Select Opportunities, LP, Madryn Select Advisors, LP, Madryn Select Advisors GP, LLC and Avinash Amin (collectively, the “Participants”) are participants in the solicitation of proxies from the stockholders of SomaLogic in connection with the special meeting of stockholders (the “Special Meeting”). On December 18, 2023, the Participants filed with the U.S. Securities and Exchange Commission (the “SEC”) their definitive proxy statement and accompanying GREEN Proxy Card in connection with their solicitation of proxies from the stockholders of SomaLogic for the Special Meeting. MADRYN STRONGLY ADVISES ALL STOCKHOLDERS OF SOMALOGIC TO READ THE DEFINITIVE PROXY STATEMENT, THE ACCOMPANYING GREEN PROXY CARD AND OTHER DOCUMENTS RELATED TO THE SOLICITATION OF PROXIES BY THE PARTICIPANTS, AS THEY WILL CONTAIN IMPORTANT INFORMATION, INCLUDING ADDITIONAL INFORMATION RELATED TO THE PARTICIPANTS AND THEIR DIRECT OR INDIRECT INTERESTS IN SOMALOGIC, BY SECURITY HOLDINGS OR OTHERWISE . The definitive proxy statement and an accompanying GREEN Proxy Card will be furnished to some or all SomaLogic stockholders and is, along with other relevant documents, publicly available at no charge on the SEC’s website at http://www.sec.gov/ . In addition, the Participants will provide copies of the definitive proxy statement without charge upon request. Requests for copies should be directed to Madryn Asset Management.
Disclaimer
This material does not constitute an offer to sell or a solicitation of an offer to buy any of the securities described herein in any state to any person. In addition, the discussions and opinions in this press release are for general information only, and are not intended to provide investment advice. All statements contained in this release that are not clearly historical in nature or that necessarily depend on future events are “forward-looking statements,” which are not guarantees of future performance or results, and the words “anticipate,” “believe,” “expect,” “potential,” “could,” “opportunity,” “estimate,” and similar expressions are generally intended to identify forward-looking statements. The projected results and statements contained in this press release that are not historical facts are based on current expectations, speak only as of the date of this press release and involve risks that may cause the actual results to be materially different. Certain information included in this material is based on data obtained from sources considered to be reliable. No representation is made with respect to the accuracy or completeness of such data, and any analyses provided to assist the recipient of this presentation in evaluating the matters described herein may be based on subjective assessments and assumptions and may use one among alternative methodologies that produce different results. Accordingly, any analyses should also not be viewed as factual and also should not be relied upon as an accurate prediction of future results. All figures are unaudited estimates and subject to revision without notice. Madryn disclaims any obligation to update the information herein and reserves the right to change any of its opinions expressed herein at any time as it deems appropriate. Past performance is not indicative of future results.
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Company filings and transcripts.
2 Company filings and transcripts.
View source version on businesswire.com: https://www.businesswire.com/news/home/20231222463165/en/
John Ferguson / Joseph Mills
info@saratogaproxy.com
Joe Germani / Ashley Areopagita
Madryn@LongacreSquare.com
Source: Madryn Asset Management, LP
What is Madryn Asset Management's view on the proposed merger between SomaLogic, Inc. (SLGC) and Standard BioTools Inc. (LAB)?
Madryn Asset Management believes there is a viable alternative to the proposed merger, citing SomaLogic's cash position and near-term commercial opportunities.
What steps does Madryn propose for SomaLogic if the merger is terminated?
Madryn proposes resolving litigation and shareholder disputes, refreshing the board, installing a commercially focused management team, implementing operational enhancements, and considering strategic alternatives on an appropriate timeline.
What are the concerns raised by Madryn regarding the proposed merger?
Madryn raises concerns about the flawed and highly conflicted process resulting in the proposed merger and the potential negative impact on shareholder value.
What are the inaccuracies highlighted by Madryn in the ISS report recommending 'cautionary support' for the merger?
Madryn highlights inaccuracies and omissions in the ISS report and expresses their commitment to helping SomaLogic pursue a better path forward.
