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CM Life Sciences II Inc.

CM Life Sciences II Inc.

Feb 1, 2021 by Matt Cianci

PROPOSED BUSINESS COMBINATION: SomaLogic

ENTERPRISE VALUE: $1.234 billion
ANTICIPATED SYMBOL: SLGC

CM Life Sciences II Inc. proposes to combine with SomaLogic, a global leader in proteomics technology, powered by a proprietary platform, the largest clinical proteomic database and next generation artificial intelligence and machine learning.

SomaLogic is a commercial stage proteomics company with over 300 established industry partnerships and customers. The company’s pioneering technology platform is uniquely capable of becoming a universal proteomics solution. Proprietary aptamers, which are target specific oligonucleotides, facilitate both broad and precise protein measurements. The SomaScan® Assay measures 7,000 human proteins in a single sample, with high specificity, low variance and high reproducibility, enabling the possibility of faster, more precise drug discovery for researchers. Artificial intelligence and machine learning powered bioinformatics algorithms operated in tandem with the company’s database of over 450,000 samples create SomaSignal™ Tests, industry leading clinical proteomic diagnostic applications, which provide additional insights to a wide customer base. Findings using this patented technology have been published by the company or collaborators in more than 250 scientific and clinical manuscripts with leading KOLs.

TRANSACTION

  • The transaction is expected to deliver up to $651 million of gross proceeds, including the contribution of up to $276 million of cash held in CM Life Sciences II’s trust account from its initial public offering in February 2021 (assuming no redemptions from the trust account) and $375 million from committed equity PIPE funding from a group of institutional and life sciences investors as well as strategic investors.
  • In the transaction, SomaLogic shareholders will receive common stock of CM Life Sciences II and, at their election, up to $50 million in cash in exchange for shares of SomaLogic.
  • Upon completion of the transaction, SomaLogic expects to have up to $686 million in cash available from the transaction ($651 million from the transaction plus existing cash on its balance sheet at closing less $85 million in share repurchases and transaction expenses) to fund operations and support new and existing business initiatives.
  • The combined company will continue to operate under the SomaLogic management team.
  • The transaction, which values SomaLogic at a pre-transaction enterprise value of approximately $1.23 billion, is expected to close during the third quarter of 2021

CM LIFE SCIENCES II TRANS OVERVIEW

PIPE

  • 37.5 million shares of Class A Common Stock for an aggregate purchase price equal to $375 million (the “PIPE Investment”)
  • PIPE investors include funds advised by Casdin Capital, Corvex Management, Janus Henderson Investors, SB Management, a subsidiary of SoftBank Group, T.Rowe Price Associates, Inc., separate accounts advised by ARK Invest, Farallon Capital, Perceptive Advisors, funds and accounts managed by Counterpoint Global (Morgan Stanley), other existing investors and a new strategic investor Illumina and an existing strategic investor Novartis Pharma AG.

LOCK-UPS

  • CMLSII will enter into Lock-Up Agreements (each, a “Lock Up Agreement”) with certain stockholders of SomaLogic, pursuant to which such stockholders have agreed from the Closing Date until the earliest of: (a) the date that is 180 calendar days from the Closing Date will not to sell, offer to sell, contract or agree to sell, hypothecate, pledge, grant any option to purchase or otherwise dispose of or agree to dispose of, directly or indirectly, or establish or increase a put equivalent position or liquidate or decrease a call equivalent position shares of Parent Class A Stock
  • Notwithstanding the foregoing, the undersigned may take any of the actions at any time after the first date on which the closing price of Parent Class A Stock has equaled or exceeded $12.00 per share for any 20 trading days within any 30-trading day period commencing at least 150 days after the Closing Date.

EARNOUT

  • If at any time between the 13-month anniversary of the Closing and the 24-month anniversary of the Closing (inclusive of the first and last day of such period, the “Earn-Out Period”), the volume-weighted average closing price of the Class A Common Stock for a period of at least 20 days out of 30 consecutive trading days ending on the trading day immediately prior to the date of determination is greater than or equal to $20.00 during the Earn-Out Period, then CMLSII will issue or cause to be issued to each SomaLogic stockholder, in accordance with such SomaLogic stockholder’s respective pro rata share, and certain employees or individual service providers of SomaLogic (the “Earn-Out Service Providers”), in accordance with the terms of their respective award agreements, 5,000,000 shares of Class A Common Stock.

SPONSOR FORFEITURE

  • Sponsor has agreed, subject to certain limitations and in accordance with the terms of the Forfeiture Agreement, to forfeit up to 33% of its shares of class B common stock of CMLSII, such actual amount tied to actual exercise of redemption rights of CMLSII stockholders exercise their redemption rights
    • In the event that Parent Stockholder Redemptions reduce the aggregate amount of funds held in the Trust Account, the Sponsor agrees to forfeit a number of the Sponsor Class B Shares equal to the product of:
      • (i) one-third (1/3) of the Sponsor Class B Shares; multiplied by
      • (ii) a percentage equal to the quotient of the dollar amount of Parent Stockholder Redemptions divided by the dollar value of the aggregate amount of funds held in the Trust Account as of the date hereof (the “Forfeiture Percentage”).

NOTABLE CONDITIONS TO CLOSING

  • The aggregate cash proceeds from CMLSII’s trust account, together with the proceeds from the PIPE Investment, equaling no less than $250,000,000 (after deducting any amounts paid to CMLSII stockholders that exercise their redemption rights and any unpaid transaction expenses incurred or subject to reimbursement by CMLSII or SomaLogic)

NOTABLE CONDITIONS TO TERMINATION

  • If the Business Combination is not consummated by December 31, 2021

ADVISORS

  • Jefferies LLC is acting as sole financial advisor and capital markets advisor to CM Life Sciences II.
  • White & Case LLP is serving as legal advisor to CM Life Sciences II.
  • Jefferies LLC, Cowen and Company, LLC and J.P. Morgan Securities LLC acted as PIPE placement agents.
  • J.P. Morgan Securities LLC and Cowen and Company, LLC are serving as financial advisors to SomaLogic.
  • Reed Smith LLP is serving as legal advisor to SomaLogic.

MANAGEMENT & BOARD

Executive Officers

Eli D. Casdin, 47
Chief Executive Officer and Director

Eli Casdin founded Casdin Capital, LLC, an investment firm focused on the life sciences and healthcare industry, in November 2011 and currently serves as its Chief Investment Officer. Since July 2020, he also serves as the Chief Executive Officer of CM Life Sciences, Inc. (Nasdaq: CMLF), a blank check company. Mr. Casdin has served on the board of directors of CM Life Sciences, Inc. since July 2020. Mr. Casdin holds a B.S. degree from Columbia University School of General Studies and an MBA from Columbia Business School.

Brian Emes, 38
Chief Financial Officer and Secretary

Mr. Emes is also the Chief Financial Officer of Corvex Management LP, a New York based investment manager, which he joined in January 2013, and the Chief Financial Officer of CM Life Sciences, Inc., since July 2020. Mr. Emes holds a B.S. degree in finance and marketing from Elon University’s Martha & Spencer Love School of Business, and is a licensed certified public accountant.

Shaun Rodriguez, 42
Chief Strategy Officer

Mr. Rodriguez joined Casdin Capital, LLC, an investment firm focused on the life sciences and healthcare industry, in July 2015 as a Senior Research Analyst and currently serves as its Director of Life Science Research. His coverage universe at Casdin Capital, LLC focuses on life science tools, diagnostics, health technology and services, and industrial applications of biotechnology. Mr. Rodriguez also serves as Chief Strategy Officer of CM Life Sciences, Inc. since July 2020. From February 2011 to July 2015, Mr. Rodriguez served as Director and Senior Research Analyst in the healthcare equity research group of Cowen Inc. (Nasdaq: COWN), an investment bank and financial services company. Mr. Rodriguez holds a Ph.D. in biological sciences from Harvard University.

Board of Directors

Keith A. Meister, 47
Chairman

Keith Meister founded Corvex Management LP, a New York based investment manager, in December 2010 and since its inception has served as its Managing Partner and Chief Investment Officer. From 2003 to 2010, Mr. Meister served as Chief Executive Officer and then Principal Executive Officer and Vice Chairman of the Board of Icahn Enterprises L.P. (Nasdaq: IEP), the primary investment vehicle for Carl Icahn. Mr. Meister currently serves on the board of directors of MGM Resorts International (NYSE: MGM), a global hospitality and entertainment company, and its affiliate Roar Digital. Mr. Meister also serves as Chairman of the board of directors of CM Life Sciences, Inc. Mr. Meister has previously served on the Board of Directors of numerous other public companies in his career, including Yum! Brands Inc. (NYSE: YUM), The Williams Companies, Inc. (NYSE: WMB), ADT, Inc. (NYSE: ADT), Ralcorp Holdings, Inc. and Motorola, Inc. (now Motorola Solutions, Inc., NYSE: MSI/Motorola Mobility, Inc.). He is Chairman of the board of the Harlem Children’s Zone and also serves on the board of trustees of the American Museum of Natural History. Mr. Meister holds a B.A. degree in government from Harvard College where he graduated cum laude.

 

 

 

ByMatt Cianci