La Jolla Pharmaceutical Company completed the acquisition of Tetraphase Pharmaceuticals, Inc..
As of May 14, 2020, Melinta Therapeutics, Inc. made a competing bid to acquire Tetraphase Pharmaceuticals. In related transactions, certain shareholders of Tetraphase and warrant holders, including Armistice Capital, LLC, have signed support agreements or exchange agreements under which such equity holders agreed to tender their shares in the tender offer and to the treatment of the warrants. The transaction will be funded by La Jolla Pharmaceutical's cash on hand. Upon the closing of the transaction, Tetraphase will become a wholly owned subsidiary of La Jolla, and shares of Tetraphase's common stock will no longer be listed on any public market. In case of termination, Tetraphase shall pay to La Jolla Pharmaceutical a termination fee of $1.15 million. As of June 24, 2020, in case of termination a termination fee of $2.04 million will be payable by Tetraphase to La Jolla Pharmaceutical.
On May 7, 2020, the Board of Directors of Tetraphase determined that the unsolicited La Jolla Proposal constitutes or could reasonably be expected to lead to a superior offer as defined in the AcelRx merger agreement, and that the failure to furnish, pursuant to an acceptable confidentiality agreement to La Jolla and engage in or otherwise participate in discussions or negotiations with La Jolla, could reasonably be expected to be inconsistent with the fiduciary duties of the Tetraphase Board to Tetraphase's stockholders under applicable legal requirements. Accordingly, in accordance with the AcelRx merger agreement, the Tetraphase Board determined to consider the La Jolla proposal, to enter into discussions and/or negotiations with respect to the La Jolla proposal and subject to La Jolla entering into an acceptable confidentiality agreement, to furnish non-public information to La Jolla. At this time, the Tetraphase Board continues to recommend the AcelRx merger agreement with AcelRx to its stockholders, is not modifying or withdrawing its recommendation with respect to the AcelRx merger agreement and is not making any recommendation with respect to the La Jolla proposal. The offer is not subject to any financing contingencies and would not require a vote by the La Jolla shareholders. The offer is subject to purchase of all shares tendered pursuant to the offer and Tetraphase net cash is equal or greater than $4.19 million as of the closing date. The proposal is subject to due diligence. There shall have been validly tendered and not validly withdrawn shares that, considered together with all other shares (if any) beneficially owned by La Jolla and its affiliates, represent at least one share more than 50% of the total number of Shares outstanding at the time prior to the expiration of the offer. The Board of Directors of La Jolla Pharmaceutical and Tetraphase have unanimously approved the transaction and recommends that stockholders tender their shares in the La Jolla tender offer once it is commenced. On June 24, 2020, the competing bid by Melinta Therapeutics was terminated. On June 24, 2020, the companies announced that the tender offer will commence within three business days and any shares not tendered in the tender offer will be acquired in a second-step merger at the same cash price as paid in the tender offer. The transaction is expected to be completed by the third quarter of 2020. The offer will close on one minute after 11:59 p.m. Eastern Time on July 27, 2020. Janney Montgomery Scott LLC is acting as financial advisor and fairness opinion advisor to Tetraphase and Hal J. Leibowitz, Stuart Falber, Christopher D. Barnstable-Brown of Wilmer Cutler Pickering Hale and Dorr LLP are acting as legal advisor to Tetraphase. . Eduardo Gallardo and Ryan A. Murr of Gibson, Dunn & Crutcher LLP acted as legal advisor to La Jolla Pharmaceutical. Broadridge Corporate Issuer Solutions, Inc. acted as paying agent to Tetraphase Pharmaceuticals. Tetraphase agreed to pay to Janney a fee upon its opinion in the amount of $0.2 million, and a fee upon the consummation of the Merger in consideration of financial advisory services rendered in connection with the merger of $0.25 million.
La Jolla Pharmaceutical Company (NasdaqCM:LJPC) completed the acquisition of Tetraphase Pharmaceuticals, Inc. (NasdaqGS:TTPH) on July 28, 2020.