Benzinga | Jun 14, 2021 12:24PM EDT

Brooklyn ImmunoTherapeutics Stock Rises After Novellus Therapeutics Buyout Deal

* Brooklyn ImmunoTherapeutics LLC (NYSE:BTX) has executed a non-binding letter of intent to acquire Novellus Therapeutics, a company developing engineered mesenchymal stem cell (MSC) therapies using mRNA cell reprogramming and gene editing technologies licensed from Factor Bioscience.

* Under the terms of the LOI, the parties intend to sign a definitive agreement and work to close the acquisition by July 15.

* The terms of the LOI value Novellus at $125 million, which is proposed to be paid by Brooklyn with $17.4 million in cash and $107.6 million in BTX common stock.

* Brooklyn currently has over $43 million of cash on its balance sheet to fund the cash component of the Transaction.

* "If the acquisition of Novellus is transacted, Brooklyn would achieve both strategic and economic benefits. This acquisition would further advance Brooklyn's evolution into a platform company with a pipeline of next-generation gene and cell therapy programs," said Brooklyn's CEO and President Howard J Federoff.

* The acquisition of Novellus builds on the license agreement that Brooklyn executed earlier this year with Factor and Novellus.

* The Transaction would relieve Brooklyn from the obligation to pay Novellus a set of upfront fees, clinical development milestone fees, and post-registration royalties.

* Price Action: BTX shares are up 8.04% at $15.45 during the market session on the last check Monday.