Cellular BioMed’s bid to privatize draws heat from shareholder rights groups
A Maryland-headquartered Cellular Biomedicine Group, which conducts immuno-oncology and stem cell clinical trials in China, is being investigated by a number of shareholders rights law firms for potential securities law violations after the company agreed to be acquired by a newly formed entity backed by a consortium of investors, private equity funds, and certain members of the CBMG’s senior management, including the company’s CEO, Tony Liu.
The completion of the merger will result in the Chinese clinical-stage drug developer becoming privatized as a subsidiary of the new parent company.
Under the terms of the agreement, shareholders will receive $19.75 for each share of common stock, which represents a premium of approximately 31% over the 30 trading-day average price of CBMG’s stock as of Aug. 11, and 12% over its closing stock price on Nov. 8, 2019, the last trading day prior to the public announcement of the consortium's initial proposal.
The shareholders’ legal representatives are investigating whether CBMG’s board members breached their fiduciary duties or violated federal securities laws in agreeing to the merger deal, and whether its board of directors oversaw an unfair process and is inadequately compensating its shareholders at the current proposed stock price.
CBMG, listed on Nasdaq, maintains its primary R&D and manufacturing facilities in China.
The completion of the merger will result in the Chinese clinical-stage drug developer becoming privatized as a subsidiary of the new parent company.
Under the terms of the agreement, shareholders will receive $19.75 for each share of common stock, which represents a premium of approximately 31% over the 30 trading-day average price of CBMG’s stock as of Aug. 11, and 12% over its closing stock price on Nov. 8, 2019, the last trading day prior to the public announcement of the consortium's initial proposal.
The shareholders’ legal representatives are investigating whether CBMG’s board members breached their fiduciary duties or violated federal securities laws in agreeing to the merger deal, and whether its board of directors oversaw an unfair process and is inadequately compensating its shareholders at the current proposed stock price.
CBMG, listed on Nasdaq, maintains its primary R&D and manufacturing facilities in China.
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