SLGC - SomaLogic Issues Letter to Stockholders Reiterating Recommendation for Value Maximizing Merger with Standard BioTools | Benzinga
Combination Builds Scale and Accelerates Path to Profitability, Unlocking Significant Potential Value for SomaLogic Stockholders
Madryn's Concerns are Not Based on Facts, and Madryn Selectively Ignores Risks in a Standalone Strategy and Potential Benefits of the Merger
Urges Stockholders to Vote "FOR" Merger Ahead of Special Meeting of Stockholders on January 4, 2024
BOULDER, Colo., Dec. 21, 2023 (GLOBE NEWSWIRE) -- SomaLogic, Inc. (NASDAQ:SLGC) today issued an open letter to stockholders highlighting the value maximizing merger entered into with Standard BioTools (NASDAQ:LAB) on October 4, 2023. The Company also filed an investor presentation, which can be found on the investor page of SomaLogic's website at https://investors.somalogic.com/static-files/daa110f7-0cc3-4eaf-ba78-e0c652b8d7a3.
The full text follows:
Dear Fellow Stockholders,
On January 4, 2024, we are holding our Special Stockholder Meeting to vote on our proposed merger with Standard BioTools – a merger that we believe is in the best interests of all SomaLogic stockholders. We urge you to vote "FOR" the Merger on SomaLogic's proxy card for three key reasons:
1. The Merger delivers compelling long-term upside, positions SomaLogic for leadership in the current market and reduces risk. To be clear, this transaction is not a sale. SomaLogic stockholders will own 57% of the combined company following close, ensuring that SomaLogic stockholders will capture the majority of the value that will be created by a leading, well-capitalized and strongly managed provider of differentiated multi-omics tools.
The combined company:
- Dramatically increases our scale and diversification, with an attractive suite of life sciences research tools, balanced mix of services and products and complementary mix of biotech and academic customers. We expect this will deliver $300 million in combined revenue by 2026.
- Accelerates our path to profitability through enhanced operating leverage and an anticipated $80 million in run-rate cost synergies by 2026. Both Standard and SomaLogic have strong cost reduction momentum already; combining the two companies allows us to continue that momentum and eliminate substantial duplicative spend.
- Benefits from a proven combined Board and leadership team. Our combined teams have complementary skills, fill gaps in each of our structures and together form a strong bench of expertise in the life sciences tools industry.
2. The Merger is the result of a comprehensive review of strategic alternatives to maximize value, driven by an independent Board. With support from independent legal and financial advisors, the Board proactively initiated a comprehensive review of strategic options over a period of months, including consideration of remaining a standalone company. We engaged with 16 parties to solicit potential interest in a transaction, but none expressed any actionable indication of interest and only one, other than Standard BioTools, entered into an NDA. This process was publicly announced in March of 2023, providing ample opportunity for any potential partner to emerge.
At all times weighing the pros and cons of SomaLogic as a standalone business, our Board negotiated the Standard BioTools proposal extensively, achieving a 30% premium1 and other key benefits for our stockholders.
3. The Merger is in the best interest of stockholders. When the Board commenced its strategic review, SomaLogic was at an inflection point. Our business is a rapidly growing and exciting one – focused on the proteomics market where we see tremendous future potential. However, the path to this future involves significant execution risk and operational challenges that we must navigate. To address these challenges, the Board proactively initiated a process to review value-maximizing paths for the benefit of all stockholders. To be clear, remaining independent was always an option – and was one that the Board was fully prepared to pursue absent a more attractive alternative. The Merger is exactly that: a more attractive alternative that retains our stockholders' exposure to our highly attractive technology and future potential through a continuing majority interest, while also creating new opportunities for value creation.
A small group of stockholders, who have worked together in the past, are now advocating against the Merger. It is hard to decipher the specific motivation or agenda of the group. However, it is obvious that many of their concerns are misplaced and rely on factually incorrect or deliberately misleading data. The Board believes it is important to be clear:
- This is not a sale, this is a combination that strengthens our business and positions our stockholders to benefit from future industry consolidation.
- The transaction is the result of a thorough, independent and deliberative Board process that was focused only on identifying strategic options that increase value for all SomaLogic stockholders. Eli Casdin was recused from all Board discussions regarding the strategic review process immediately once Standard BioTools emerged as a counterparty.
- The SomaLogic Board secured a fiduciary out that would allow us to accept and execute on a Superior Proposal should one emerge.
- The capital structure of the combined company is not risky. The pro forma company is strong with over $500 million of cash and only $68 million of debt. Further, Standard's Series B Preferred stock is an equity security (not debt) with no preferred dividend or mandatory redemption feature.
Facts matter. It is critical for our fellow stockholders to understand that the SomaLogic Board is, and always has been, acting ...