Adagio Medical will become a subsidiary of Aja Holdco, which will operate with its existing management team under the same name as Adagio Medical, and shares of the combined company will be listed on the Nasdaq Capital Market
Adagio Medical is focused on cryoablation technologies. (Credit: Adam Radosavljevic from Pixabay)
US-based cryoablation technology provider Adagio Medical has agreed to merge with ARYA Sciences Acquisition Corp IV (ARYA), a special purpose acquisition company (SPAC) sponsored by an affiliate of Perceptive Advisors.
The boards of directors of both ARYA and Adagio Medical have approved the proposed merger.
The transaction is expected to be completed in the second quarter of this year, subject to the satisfaction of certain other customary closing conditions, including shareholders’ approval.
Upon closing of the merger, Adagio Medical will become a subsidiary of Aja Holdco, which will operate with its existing management team under the same name as Adagio Medical.
The shares of the combined company will be listed on the Nasdaq Capital Market under the ticker symbol ‘ADGM’.
Investors have committed to participate in the transaction in the form of $20m in convertible debt, which includes bridge financing, and $22m in equity financing.
The investors who participated in the financing include affiliates of Perceptive Advisors, RA Capital Management (RA Capital), RTW Investments and ATW Partners.
Adagio Medical president and CEO Olav Bergheim said: “The business combination agreement and Adagio Medical’s evolution to a public company is a natural next step in our relationship with Perceptive Advisors and other investor groups who have long supported Adagio Medical’s innovations aimed to improve the efficacy of cardiac ablations.
“We are expanding the clinical trials program for Adagio Medical’s proprietary ultra-low temperature cryo (ULTC) and pulsed-field cryoablation (PFCA) technologies, with some of the pivotal data and new product launches expected in the first half of 2024.
“The business combination and related financings with ARYA will ensure that the company has sufficient capital to support its European commercialization of Adagio Medical’s ULTC system for treatment of ventricular tachycardias (VT) and initiation of the US Pivotal VT IDE trial and to further advance our worldwide ULTC and PFCA clinical programs for atrial fibrillation.”
The transaction values the combined company at a post-transaction equity value of $128m and an enterprise value of $113m, both on a fully diluted basis.
Investors holding Adagio Medical shares and certain vested equity awards are converting their entire existing equity interests into shares or equivalent awards of the combined company.
Also, the non-redeeming ordinary shareholders of ARYA will convert their ordinary shares into the combined company’s common stock on a one-for-one basis.
Upon closing, Perceptive and ARYA are expected to hold around 58.2% of the combined company, and other investors in Adagio Medical are expected to own around 10.2%.
Stifel, Nicolaus & Company (Stifel) served as financial advisor to Adagio Medical, while Jefferies served as financial and capital markets advisor and sole private placement agent to ARYA.
Chardan Capital Markets served as sole placement agent for the convertible debt.
Reed Smith served as legal counsel to Adagio Medical, and Kirkland & Ellis as legal counsel to ARYA, while White & Case served as legal counsel to Jefferies, Stifel and Chardan.
ARYA CEO and Perceptive Advisors chief investment officer Adam Stone said: “When Arya IV was formed, our objective was to identify a company with the potential to successfully address a significant, unmet need and to advance the treatment of patients.
“In Adagio Medical, we’ve come to believe that the company’s innovative cardiac ablation technology, thoughtful commercialization strategy, and experienced leadership team make it an exceptional fit to meet our objectives.”
Adagio Medical is a US-based medical device company focused on cryoablation technologies that create contiguous, transmural lesions to treat cardiac arrhythmias.