Healthcare Company Roivant Agrees to Go Public in $7.3 Billion SPAC Deal

By Mariliana Fotopoulou Monday, May 3, 2021

Healthcare company Roivant Sciences said it plans to go public through a merger with a special acquisition company (SPAC) that sets the drugmaker’s business valuation at $7.3 billion.

A scientist working with petri dishes.

Another Mega SPAC Deal

Montes Archimedes Acquisition Corp., a SPAC backed by investment firm Patient Square Capital, is set to merge with Roivant in a business deal including private financing from Palantir Technologies, Viking Global Investors, Softbank, and others who committed to injecting $200 million in a new publicly-traded company.

The business deal is expected to complete in Q3 this year and will provide the healthcare company with $611 million in fresh capital to bring the drug company’s net cash position to $2.3 billion.

Chief Executive of the company, Matthew Gline, said his company initially planned to go public through a traditional initial public offering (IPO) but opted for a merger with a SPAC as a more appealing way to list shares.

“Roivant is at the cutting edge of using technology to discover and develop transformative medicines for a wide range of serious diseases, and in a very short time they have established a remarkable track record of building subsidiaries that have run successful registrational clinical trials for approved medicines," said Patient Square Capital Managing Partner Jim Momtazee in a press release.

Roivant founder and former hedge fund investor Vivek Ramaswamy started the company in a bid to secure a portfolio of early-stage experimental therapies that were undervalued at large pharmaceutical giants.

After receiving support from hedge funds, including Viking and QVT Investors, Roivant started multiple businesses named “vants” operating across different therapeutic areas. Furthermore, Roivant has also launched substantial computational solutions in an effort to develop drugs from the ground up with machine-learning capabilities.

The healthcare business sold five of its vant companies and a 10% stake in 2019 to Japanese Sumitomo Dainippon Pharma for $3 billion. After the new merger, Roivant’s shareholders will collectively own 92% of the company following a SPAC merger at a $7.3 billion business valuation.

"I look forward to the next chapter of Roivant's growth by beginning our life as a public company with an exceptionally strong and diverse base of long-term investors," said Gline about the healthcare business.

The company has also made business investments in the development of over 40 therapies, two of which obtained approval from the Food and Drug Administration (FDA). The company’s most prominent drug candidate, developed for Alzheimer’s patients, failed in the late-stage trial.

Still, the healthcare business has a number of other high-profile drugs in development, particularly the topical psoriasis treatment developed by Roivant’s Dermavant Sciences that has completed two successful Phase Three trials. Its Aruvant Sciences company is developing an experimental drug for sickle cell disease, currently in an early-stage clinical trial.

Gline will continue to be CEO of a new company, while founder Vivek Ramaswamy will serve as Executive Chairman.

Summary

Healthcare company Roivant Sciences announced it is going public through a SPAC deal that values the company at $7.3 billion. The business deal is expected to close in Q3 of this year and will provide the company with $611 million in fresh capital.

About the Author


Headshot of Mariliana Fotopoulou

Mariliana has an MSC in Consumer Analytics and Business Strategy. She has a special interest in fast-moving industries and Big Data.

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