euro adhoc: Intercell AG
Mergers - Acquisitions - Takeovers
Intercell AG to
acquire Iomai Corporation to expand late stage product pipeline and strengthen
leadership in vaccine innovation
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» Intercell AG ("Intercell") to acquire Iomai Corporation ("Iomai") in a fully recommended share/cash transaction for USD 6.60 per share of Iomai´s common stock representing a fully diluted equity value of Iomai of approximately USD 189 million (EUR 122 million). Acquisition to be accomplished through stock-for-stock exchange for approximately 41 percent of Iomai´s current shares outstanding held by major shareholders for approximately 1.7 million Intercell shares (representing approximately four percent of Intercell´s total outstanding shares), and an all-cash merger for the remaining fully diluted outstanding shares of Iomai´s common stock for approximately USD 119 million (EUR 77 million).
» The deal creates a leading Traveler´s Vaccine portfolio by combining Intercell´s Japanese Encephalitis vaccine with Iomai´s needle-free Travelers' Diarrhea vaccine. The Travelers' Diarrhea vaccine is planned to enter pivotal Phase III trials in the first half of 2009 and is based on the only advanced needle-free vaccine patch technology in the industry. Through the transaction Intercell gains access to a further product generating technology platform.
» Valuable expansion of Intercell´s pipeline and leveraging Intercell´s late stage product development and industrialization expertise with two further programs in clinical development including a vaccine patch for pandemic influenza in Phase II.
» Intercell will finance the cash component of the transaction consideration of approximately USD 119 million (EUR 77 million) comfortably from existing reserves and expects to maintain profitability in 2008.
Vienna (Austria), Gaithersburg (Maryland, USA), May 12, 2008 - Intercell AG (VSE: ICLL) and Iomai Corporation (NASDAQ: IOMI) announced today that they have entered into a definitive agreement pursuant to which Intercell will acquire Iomai for USD 6.60 per share representing a fully diluted equity value of approximately USD 189 million (EUR 122 million). The transaction has been unanimously approved by the Boards of Directors of both companies and is subject to customary closing conditions including antitrust clearances, clearance by the Committee on Foreign Investment in the United States and the approval of the holders of a majority of Iomai´s shares. Shareholders holding over 50 percent of Iomai´s total shares outstanding have entered into agreements to vote in favour of the combination.
Intercell will gain full rights to Iomai´s late stage Travelers' Diarrhea vaccine which is based on Iomai´s proprietary needle-free patch delivery vaccine technology and has shown positive interim Phase II efficacy data. The Travelers' Diarrhea vaccine is expected to enter pivotal Phase III trials in the first half of 2009. If approved, the medical use of Iomai´s Travelers' Diarrhea vaccine will be highly complementary with Intercell´s Japanese Encephalitis vaccine for which a Biologics License Application was successfully submitted to the US Food and Drug Administration in December 2007, and for which Intercell expects market approvals in the US, Europe and Australia in 2008. Together, both vaccines create an extremely attractive Traveler´s Vaccine franchise which will target a combined market opportunity of over USD 1 billion in sales per year.
Commenting on the transaction, Gerd Zettlmeissl, CEO of Intercell, said: "This transaction further expands our leadership in vaccine innovation, greatly enhances Intercell´s R&D technology base and further strengthens our late stage vaccine portfolio. Building on our proven experience in industrialization and in moving novel products to the market, Intercell is fully committed to becoming the leading pure play vaccine company globally. We look forward to welcoming Iomai´s employees to Intercell and are excited by the potential of the combined group to create significant value for all stakeholders."
Stanley C. Erck, President and CEO of Iomai, said: "We have built a dynamic and scientifically driven organisation. This strategic combination with Intercell will create a stronger, more diversified vaccine company and will accelerate the development of Iomai´s vaccine programs and fully leverage our innovative TCI technology. We believe this transaction is in the best interest of all parties, including shareholders, employees and ultimately patients."
Intercell will also gain full rights to two additional clinical and three preclinical programs under development, the most advanced being an immunostimulant vaccine patch in Phase II for pandemic influenza. This patch is designed to enhance the immune response compared to injected pandemic influenza vaccines. If successful, it would have the effect of expanding limited vaccine supplies by allowing public health officials to use fewer or lower doses of the vaccine. The vaccine patch has recently generated positive interim immunogenicity data in a 500-subject Phase I/II study with a one-dose application. The program is funded by a grant from the United States Department of Health and Human Services.
Iomai´s pioneering work in transcutaneous immunization (TCI) technology has led to the development of a simple and promising needle-free vaccine patch. This highly innovative vaccine delivery system provides a potential future alternative to current injected vaccines. TCI technology has the potential to enhance the efficacy of existing vaccines, replace current vaccines that have a cumbersome mode of administration and enable the development of new vaccines that are not viable to be delivered via an injection.
Iomai´s TCI technology strengthens Intercell´s position as an innovative vaccine company and is highly complementary with its proprietary antigen identification and adjuvant vaccine technology platforms (AIP® and IC31®). TCI adds an important third arm to Intercell´s leading vaccine technologies, specifically a delivery platform for antigens and adjuvants that can facilitate the development of a broad range of in-house and partnered vaccine products. Both companies have already partnered technologies with Merck & Co., Inc., the most recent one being Iomai´s agreement to conduct proof-of-principle preclinical studies evaluating the use of its needle-free immunostimulant patch. Intercell plans to further leverage the TCI technology by applying it to other vaccines in its development pipeline, such as its Pneumococcus vaccine candidate.
Furthermore, Iomai´s vaccine patch has the potential to provide cheaper and more effective medication to those living in endemic areas, in particular high risk groups such as children and the elderly located in developing countries in Africa, Asia and Latin America.
Under the terms of the merger agreement, Intercell will acquire Iomai for USD 6.60 per share of Iomai´s common stock representing a fully diluted equity value of Iomai of approximately USD 189 million (EUR 122 million). The consideration will be paid in cash and stock. Iomai´s public shareholders, representing approximately 59 percent of Iomai´s outstanding common stock will receive cash. Certain of Iomai´s largest shareholders, together representing approximately 41 percent of Iomai´s outstanding common stock, have agreed to exchange their shares for Intercell stock at an exchange ratio corresponding to a value of USD 6.60 per share of Iomai common stock upon closing. The combination is structured as a share exchange together with a merger of Iomai and a US subsidiary of Intercell. Certain of Iomai´s largest shareholders (and their affiliates), which together represent over 50 percent of Iomai´s outstanding common stock, have agreed pursuant to a voting agreement with Intercell that they will vote their shares in favour of the merger.
The transaction has been unanimously approved by the Boards of Directors of both companies and is subject to customary closing conditions, including the approval of the merger by a majority of shareholders of Iomai at a special shareholder meeting to be held as soon as practical, receipt of antitrust clearances and clearance by the Committee on Foreign Investment in the United States. Intercell and Iomai expect the transaction to close before the end of the third quarter of 2008.
Based on Intercell´s closing share price as of 9 May 2008, Intercell would issue approximately 1.7 million Intercell shares from authorized capital as consideration, the final number of Intercell shares to be determined shortly before the closing of the transaction. Intercell will fund the cash component of the transaction from existing cash reserves and expects to maintain profitability in 2008.
Merrill Lynch International acted as exclusive financial adviser to Intercell and Cowen and Company provided a financial fairness opinion to Iomai´s Board of Directors.
Analyst/Shareholder Conference Call
A conference call on the transaction together with Intercell´s Q1 2008 results will be held by Intercell and Iomai´s senior managements on May 13, 2008 at 8:30 a.m. CET (7:30 a.m. GMT). A webcast replay of the conference call will be made available on Intercell´s website. For further information please go to www.intercell.com.
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ots Originaltext: Intercell AG
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