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IPO Roundup: Urovant Sciences, EdtechX and Remora Royalty to tap the capital markets, while Volvo Cars drops IPO

Last updated: 15:55 11 Sep 2018 EDT, First published: 15:12 11 Sep 2018 EDT

Ramaswamy is the founder and CEO of Roivant Sciences, which serves as an umbrella company for a variety of his life science outfits
Vivek Ramaswamy is known for executing the US$315 million IPO for Axovant and US$218 million IPO for female health firm Myovant

The smart money is going to follow former hedge fund manager Vivek Ramaswamy’s gambit to take Irvine, California-based clinical-stage biotech company Urovant Sciences public through a US$150mln IPO. Urovant Sciences is focused on urologic conditions and it’s lead product, Vibegron, is aimed at people suffering from overactive bladder systems.

A Harvard alumnus with a biology degree and a law degree from Yale Law School, Ramaswamy gained attention when he turned US$5mln into US$3bn by taking his first company, Axovant Sciences Ltd (NASDAQ:AXON), public in 2015. Ramaswamy built Axovant around a dementia drug to treat Alzheimer’s, which he purchased from GlaxoSmithKline plc (NYSE:GSK) for US$5mln. Using a pharmaceutical holding company, Roivant Sciences, Ramaswamy hopes to spin out dozens of companies, much as he did with Axovant. 

Ramaswamy, 33, has made a business of liberating abandoned or deprioritized drugs that routinely languish in the pipelines of large pharma companies, never reaching patients. "It's an ethical problem of an underappreciated magnitude," Ramaswamy told Forbes. "So many drugs that would have been of use to society are cast aside. Certain drugs have gone by the wayside for reasons that have nothing to do with their underlying merits."

READ: Axovant Sciences ‘emphasizes reboot’ with gene therapy, says Oppenheimer

Urovant has struck a licensing deal with Merck Sharp & Dohme, a subsidiary of Merck & Co (NYSE:MRK), in June 2017 which will give it access to late-stage overactive bladder treatment Vibegron. It also licensed hMaxi-K, a gene therapy for patients with overactive bladder.

“We are currently evaluating Vibegron in our 1,400 patient, international pivotal Phase 3 EMPOWUR trial for the treatment of overactive bladder, or OAB,” the company said in its filing. “We expect to report top-line results from this clinical trial in the first or second quarter of 2019, and if these results are positive, we plan to submit a new drug application to the US Food and Drug Administration by early 2020.”

Vibegron addresses a condition which affects more than 30 million Americans over the age of 40.

For the three months ended in June, Urovant had operating expenses of US$31.47mln up from a year-ago US$3.61mln and a corresponding net loss of $31.3mln. The company currently has US$4.25mln in cash.

The company will debut on the tech-laden Nasdaq and will trade under the “UROV” ticker.

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London-headquartered EdtechX Holdings Acquisition, a blank check company formed by IBIS Capital, has filed for a US$55 million IPO by offering 5.5 million units at a price of US$10. Each unit consists of one share of common stock and one warrant redeemable at US$11.50. The UK-based will debut on the Nasdaq under the "EDTXU" symbol.

Austin, Texas-based Remora Royalties will issue 5.25 million shares, saying in a regulatory filing that the stock will be priced at US$19 to US$21 each. The company is planning to list on the tech-laden Nasdaq under the ticker “RRI.”

The company has a significantly diversified portfolio of royalty interests in mature producing oil and natural gas basins and exposure to undeveloped opportunities.

“We have a diversified, low decline asset base with exposure to high-quality conventional and unconventional plays. As of December 31, 2017, we owned royalty interests in approximately 593,000 gross acres and approximately 43,000 net acres, of which approximately 57% is operated by the contributing parties,” the company said in its filing.  

“As of December 31, 2017, over 97% of the acreage subject to our royalty interests were held by production. The geographic breadth of our assets gives us exposure to potential production and reserves from new and existing plays without further required investment on our behalf,” it added.

Volvo hits the brakes

Swedish luxury car maker Volvo Cars and its Chinese owner Geely have postponed plans for a dual Stockholm and Hong Kong listing, blaming trade tensions and a downturn in car stocks.

“We’ve come to the conclusion that the timing is not optimal for an IPO right now,” Volvo Chief Executive Hakan Samuelsson told Reuters.

The Volvo boss said that “conditions right now are not optimal,” and called trade discussions between the United States, China and Europe “really difficult to predict.” 

The Chinese owner Geely, whose portfolio includes Lotus and Proton, sought a $30bn valuation, according to the Financial Times.

According to media reports, the introduction of American and Chinese tariffs has already hit groups like BMW and Daimler, which ship American-made cars to China. Their shares are down 6% and 23%, respectively, so far this year. While no sector has been spared in Trump’s trade war, the damage is most visible in the automotive industry as large car manufacturers have exposure to most geographies.

While Volvo’s plans for a public listing are now delayed indefinitely, Britain’s Aston Martin, the maker of James Bond cars, vowed this week to push ahead with its own IPO. Aston Martin is looking set to come to market probably in October, with a targeted valuation of around £5bn.

Contact Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter@UttaraProactive 

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