Sesen Bio (NASDAQ:SESN) investors reiterated their plan to vote against the merger with Carisma Therapeutics, calling it an “illogical, value-destructive” deal. Sesen rose 4.2%.
Bradley L. Radoff and Michael Torok, along with their affiliates, who own approximately 8.4% of Sesen Bio (SESN), argue that Sesen Bio (SESN) would be “far better off” if the merger was terminated and the company’s $140 million in cash was “efficiently” returned to holders, the investors said in the statement.
The opposition comes after Sesen (SESN) shares surged 20% on Friday after the company said it will increase the one-time special cash dividend to its shareholders to ~$70M, or ~$0.34/share. The special dividend, in connection with Sesen’s (SESN) acquisition by Carisma Therapeutics, represents excess cash available after Sesen (SESN) meets a required net cash minimum of $75M.
“We believe the December 29, 2022 amendment to the merger agreement does not adequately return value to Sesen Bio’s stockholders,” the investors said in the statement. “We have consistently advocated for terminating the merger in favor of returning cash and a CVR to the Company’s stockholders in a value-maximizing manner.”
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The investor group estimates that the cash available to return to Sesen (SESN) holders would translate to at least $0.70 per share, representing a 15% premium to where the Sesen stock closed on Friday.
Last month, the group disclosed 7.4% stake in the company. Sesen (SESN) and Carisma engaged with the group to reach a resolution, offering to raise the dividend to ~$70M. However, the group continues to demand ~$100M dividend.
Source: Seeking Alpha
