Bluebird bio receives higher upfront offer from PE firms Carlyle, SK Capital

Audio By Carbonatix

Enlarge

(Reuters) – Carlyle Group and SK Capital Partners increased their upfront offer to take over gene therapy maker bluebird bio, the companies said on Wednesday.

Shares of bluebird bio jumped over 50% to $4.97 in early trading.

The private equity firms made a new offer of $5 per share upfront, while the previous bid had offered $3 per share upfront and a contingent value right (CVR) of $6.84 per share, payable upon bluebird achieving certain sales milestones.

The new bid could amount to about $49 million, according to Reuters calculations using data compiled by LSEG.

Shareholders of bluebird may elect to receive either the new or the old offer, the companies said.

“The amended offer price provides an alternative for stockholders who would prefer greater upfront cash consideration instead of the potential upside of the CVR,” the companies said. 

Bluebird’s board of directors unanimously approved the amended agreement and recommends that all stockholders immediately tender their shares in support of the transaction.

The company has been facing a cash crunch and first raised going-concern doubts three years ago. It laid off a quarter of its workforce last year to focus on launching three gene therapies, including Lyfgenia for sickle cell disease, which has seen a slow uptake.

In March, the company received a non-binding bid of $4.50 per share upfront from Ayrmid, the parent company of cell therapy developer Gamida Cell, along with the same contingent $6.84 per share.

But there was no binding offer from Ayrmid, bluebird said last month.

(Reporting by Puyaan Singh in Bengaluru’ Editing by Anil D’Silva and Shinjini Ganguli)