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(Sharecast News) - Biotherapeutics company PureTech Health has proposed a capital return of $100.0m to its shareholders by way of a tender offer.
PureTech said on Tuesday that the proposed capital return represented approximately 14% of its market capitalisation based on Monday's closing price and noted that it follows a previous announcement that it will receive approximately $293.0m in gross proceeds from its remaining stake in Karuna.
The AIM-listed group said the offer will be launched after the publication of its full-year results in April, subject to market conditions, and will require shareholder approval.
PureTech added that if the full $100.0m was not returned, then it intends to return any remainder following the completion of the offer, by way of a special dividend.
Chief executive Daphne Zohar said: "PureTech's mission is to generate value both for patients and shareholders, and Bristol Myers Squibb's acquisition of our Founded Entity Karuna Therapeutics for $14.0bn is a testament to our execution on both fronts. We directed $18.5m to the founding and development of Karuna, and not only have we created a potential breakthrough treatment that may change the lives of millions of people living with schizophrenia, but we have also been able to generate $1.1bn in cash for PureTech, with potentially more to come. These resources enabled us to create an exciting crop of new medicines that position us to repeat and scale this type of outcome - and we have done so without diluting our shareholders in over six years.
"We are delighted to be able to purchase shares of PureTech at this valuation and to concurrently provide some liquidity to our shareholders and additional capital returns beyond the recently completed $50.0m share buyback. Following this proposed tender offer, we are confident that our strong balance sheet will continue to support the development of our existing pipeline - as well as the next wave of innovative medicines. Looking forward, the board will continue to assess ongoing opportunities to improve shareholder returns."
As of 1055 GMT, PureTech shares were up 8.58% at 221.50p.
Reporting by Iain Gilbert at Sharecast.com
