Curetis and OpGen announced that the two companies have entered into a definitive agreement to combine businesses.
The transaction will be structured as an acquisition by OpGen of Curetis GmbH, a subsidiary of Curetis that owns all of the Curetis business. Upon closing of the transaction, which is expected in early 2020, Curetis GMbH will become a wholly owned subsidiary of OpGen.
The acquisition will create a transatlantic, US-headquartered, listed company with a commercial-stage molecular diagnostics and bioinformatics franchise and a pipeline focusing on infectious diseases and antimicrobial resistance, the firms said in a statement.
The combined company will be headquartered in Gaithersburg, Maryland with European operations run from Holzgerlingen, Germany. The Ares Genetics subsidiary of Curetis will continue its bioinformatics and next-generation sequencing service laboratory operations in Vienna, Austria.
“We are convinced that the combination of OpGen and Curetis will help maximize value for our stockholders and will result in an organization with a robust pipeline of molecular diagnostic and bioinformatics products, significant management experience, and proprietary assets for developing and commercializing novel data-driven solutions in infectious disease diagnostics,” Evan Jones, OpGen’s chairman, president, and CEO, said in a statement.
At the closing of the transaction, Curetis will be entitled to receive 2,662,564 new shares of common stock of OpGen reflecting a valuation of the combined business of roughly $24 million.
According to a statement, the initial main focuses for the combined company will be rapid diagnostics for lower respiratory infection and urinary tract infection, and bioinformatics and NGS services for AMR prediction with Ares Genetics and bioinformatics services based on OpGen’s Acuitas Lighthouse AMR knowledgebase.
Both companies had lately struggled to achieve a good valuation of their technologies and remain financially solvent. Curetis announced last year it would eliminate up to 30 percent of its global workforce as part of a strategic reorganization, and last month the company reported that it was delaying its financial reporting and had hired an investment bank to help it review strategic options for securing the money it needs to continue operations. OpGen meanwhile announced last week that it planned a reverse stock split after being notified it was non-compliant with minimum shareholder equity requirements.