The agreement enables Karl Storz to engage in diligence and negotiations over a potential acquisition of the surgical robot maker. Asensus and Karl Storz began a collaboration over surgical robotics just over a year ago that included plans for marketing and development.
Entry into the letter of intent follows an extensive period of consideration of strategic alternatives, Asensus said in a news release. That included potential collaborations and licensing transactions, a “go-it-alone” strategy reliant upon significant fundraising, a sale of the company or additional development transactions.
Instead, the company’s board approved the letter of intent with Karl Storz, which includes a proposal to acquire 100% of the issued and oustanding shares of Asensus common stock at 35¢ per share in cash. That represents a 66.7% premium to the closing price of Asensus stock on April 2, 2024. Karl Storz communicated that the proposed price represents its “best and final offer.”
More details on the LOI
The letter of intent provides that, during an exclusivity period of up to 10 weeks, Asensus won’t engage in negotiations for alternative transactions. During that period, Karl Storz intends to conduct diligence as the companies negotiate a merger. Both companies have the right to terminate pursuit of the proposed transaction.
In connection with the LOI, Asensus entered into a fully secured promissory note (bridge loan) with Karl Storz. This allows the company to receive a loan of up to $20 million from Karl Storz to support operations through the exclusivity period and beyond.
The companies say they plan to work diligently during the exclusivity period to negotiate and finalize a merger agreement. If agreed, Asensus then plans to work expeditiously to secure stockholder approval, the company said.
Asensus said it can’t provide any assurances of a final agreement with Karl Storz.
What Asensus Surgical does
Research Triangle Park, North Carolina-based Asensus develops the Senhance surgical robot platform. It also develops the Intelligent Surgical Unit (ISU) for Senhance.
Asensus designed ISU as a real-time intraoperative surgical image analytics platform. It leverages augmented intelligence to help reduce surgical variability.
Asensus also unveiled its the next-generation Luna robot in February 2023. The integrated digital surgery solution features a next-generation surgical platform and instruments, plus real-time intraoperative clinical intelligence. Its final component, a secure cloud platform, applies machine learning to deliver clinical insights.
The company suggested last year that it targeted 2025 for FDA clearance for Luna. At the start of this year, the company showed Luna off to surgeons, conducting an in vivo lab evaluation of the next-generation surgical robot. The company inked a manufacturing deal for the platform in November as well.
