On May 3, 2021 Roivant Sciences, a biopharmaceutical and healthcare technology company, and Montes Archimedes Acquisition Corp. (Nasdaq: MAAC), a special purpose acquisition company sponsored by Patient Square Capital, reported that they have entered into a definitive business combination agreement (Press release, Roivant Sciences, MAY 3, 2021, View Source [SID1234578996]). Upon closing of the transaction, outstanding shares and warrants of MAAC will be exchanged for newly issued shares and warrants of Roivant Sciences, which is expected to be listed on Nasdaq under the new ticker symbol "ROIV."

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The transaction is expected to deliver up to $611 million of gross proceeds to fund discovery and development programs. This includes up to $411 million currently held in MAAC’s trust account, as well as a concurrent $200 million common stock private investment in public equity ("PIPE") priced at $10.00 per share. New institutional and strategic investors and existing Roivant shareholders have committed to participate in the PIPE, including Fidelity Management & Research Company LLC, Eventide Asset Management, Suvretta Capital, Palantir Technologies, RTW Investments, LP, Viking Global Investors, Sumitomo Dainippon Pharma, and SB Management, a subsidiary of SoftBank Group Corp. Proceeds are expected to extend the company’s operating runway through mid-2024.

Patient Square Capital and key Roivant equity holders and management have agreed to long-term lockups, with at least 50% of their holdings locked up for three years. In addition, Patient Square Capital has agreed to convert an additional 30% of its shares of MAAC to earn-out shares subject to performance vesting thresholds: 20% of its shares will vest at $15.00 per share and 10% will vest at $20.00 per share for 20 of 30 trading days within five years of closing.

Jim Momtazee, Managing Partner of Patient Square Capital, will join Roivant’s board of directors. Prior to founding Patient Square Capital, Mr. Momtazee was a 21-year veteran of KKR where he helped form its health care investment team 20 years ago and ran that team for over a decade.

"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 Mr. Momtazee. "I first met the company in 2015 and have watched its growth over the last 6 years with admiration. Based on our extensive due diligence spanning the last 5 months, I look forward to a long-lasting partnership with one of the most exciting and innovative companies in the life sciences industry."

Roivant will continue to operate under its current management team led by Chief Executive Officer Matthew Gline. Roivant founder Vivek Ramaswamy will continue to serve as Executive Chairman.

"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 Mr. Gline. "We look forward to continuing to deliver important medicines to patients through our development engine and our rapidly growing drug discovery capabilities spanning multiple therapeutic areas and modalities."

The boards of directors of both Roivant and MAAC have unanimously approved the proposed transaction. Completion of the transaction, which is expected in the third quarter of 2021, is subject to approval of MAAC shareholders and the satisfaction or waiver of certain other customary closing conditions. A link to investor presentation materials is included below.

Roivant Sciences Overview
Since its founding in 2014, Roivant has put over 40 medicines into development across a wide range of disease areas. Companies built by Roivant have conducted eight consecutive positive Phase 3 studies with two FDA approvals to date. Roivant is also a leader in computational drug discovery through its combination of computational physics and machine learning-based platforms for the in silico design of small molecules. Roivant has over 800 employees across its family of companies today.

Transaction Overview
In this all-primary transaction, current holders of Roivant shares and equity awards will maintain their existing equity interests in Roivant. Current shareholders and warrant holders of MAAC will convert their shares and warrants of MAAC into common shares and warrants of Roivant on a one-for-one basis. Assuming a share price of $10.00 per share and no redemptions of MAAC shares, Roivant is expected to have an initial market capitalization of $7.3 billion inclusive of its pro forma net cash balance of approximately $2.3 billion.

Assuming no redemptions of MAAC shares, current shareholders of Roivant will own approximately 92% of Roivant immediately post-closing (including shares issued in connection with Roivant’s recent acquisition of Silicon Therapeutics and existing Roivant shareholder participation in the PIPE).

The closing of this transaction is expected in the third quarter of 2021 and is subject to the approval of MAAC’s shareholders and the satisfaction or waiver of certain other customary closing conditions.

Additional information about the proposed transaction, including a copy of the Business Combination Agreement and an investor presentation, will be provided in a Current Report on Form 8-K to be filed today by MAAC with the Securities and Exchange Commission ("SEC") and available at www.sec.gov.

Advisors
J.P. Morgan Securities LLC is serving as a financial advisor and capital markets advisor to Roivant and as a lead placement agent for the PIPE. SVB Leerink LLC is serving as a capital markets advisor to Roivant and as a lead placement agent for the PIPE. Goldman Sachs & Co. LLC is serving as a financial advisor to Roivant. Cowen and Company, LLC is serving as a financial advisor and capital markets advisor to Roivant. Citigroup Global Markets Inc. is serving as a placement agent for the PIPE. Truist Securities, Inc. is serving as a capital markets advisor to Roivant and as a placement agent for the PIPE. Davis Polk & Wardwell LLP is acting as legal counsel to Roivant. Kirkland & Ellis LLP is acting as legal counsel to MAAC.