Acelyrin-Alumis Merger Faces Opposition from Major Shareholder

In a significant development in the biotechnology sector, the proposed merger between California-based companies Acelyrin and Alumis has encountered opposition from a major shareholder. Trium Capital, a substantial investor in Acelyrin, has announced its intention to vote against the planned merger, citing concerns over valuation and strategic alternatives.

Shareholder Dissent and Alternative Proposals

Trium Capital, an England-based investment firm, expressed its disapproval of the merger in a letter dated April 28th. The firm contends that the deal undervalues Acelyrin and argues that better strategic options are available. Trium's letter states, "It is unclear to us why Acelyrin should accept a consideration that is so substantially less than its cash value."

The opposition from Trium follows an earlier intervention by Tang Capital's Concentra Biosciences, which in February proposed to acquire Acelyrin for $3 per share, totaling approximately $300 million. This offer represented a significant premium over Acelyrin's trading price of $2.17 at the time. Concentra's proposal also included a contingent value right, offering Acelyrin's shareholders 80% of net proceeds from potential out-licensing deals or asset sales.

Merger Details and Company Responses

The merger agreement between Acelyrin and Alumis, announced in February, is structured as an all-stock transaction. Under the terms of the deal, Alumis would absorb Acelyrin, with Acelyrin stockholders owning 45% of the post-merger company. The combined entity would be led by Alumis' current executive leadership.

Acelyrin's response to these developments has been firm. The company rebuffed Concentra's offer, arguing that it "is not reasonably expected to result in a superior" deal compared to the merger with Alumis. Furthermore, Acelyrin adopted a "poison-pill defense" in mid-March, allowing its stockholders to purchase additional shares at a steep discount in the event of a takeover attempt.

Financial Implications and Future Outlook

According to an SEC filing, the merged company would have approximately $737 million in cash, sufficient to fund operations into 2027. This timeline extends beyond several expected data readouts, including a current Alumis Phase III trial for plaque psoriasis and a Phase IIb trial in systemic lupus erythematosus.

Trium Capital has suggested that winding down Acelyrin's operations and liquidating its assets could provide better value for shareholders. The investment firm argues that this approach "provides certainty of value well above the value from any of the offers received thus far."

As the situation unfolds, all eyes are on the upcoming Acelyrin stockholder meeting scheduled for May 13, where shareholders will vote on the proposed merger. The outcome of this vote could significantly impact the future of both Acelyrin and Alumis, as well as potentially reshape the competitive landscape in their respective areas of focus within the biotechnology industry.