Bluebird Bio Stock Soars On Higher Upfront Payment Under Amended Merger Deal: Retail Gets More Bullish
Synopsis
The upfront payment of $5 represents a 51% premium to Bluebird’s closing price of $3.31 on Tuesday.
Bluebird Bio, Inc. (BLUE) said on Wednesday that global investment firms Carlyle (CG) and SK Capital Partners have agreed to purchase all its outstanding shares and take the company private for $5 per share upfront.
Under the terms of the amended agreement, Bluebird stockholders can elect to receive either $3 per share in cash plus a contingent value right (CVR) of $6.84 per share in cash payable upon achievement of a net sales milestone or $5 per share in cash.
The upfront payment of $5 represents a 51% premium to Bluebird’s closing price of $3.31 on Tuesday.
Shares of the company traded over 50% higher on Wednesday morning.
Gene therapy maker Bluebird first entered a definitive agreement with Carlyle and SK Capital in February. As per the original agreement, stockholders had only one option of receiving $3.00 per share in cash plus a CVR of $6.84 per share.
Bluebird said the amended agreement allows an alternative for stockholders who would prefer greater upfront cash consideration instead of the potential upside of the CVR.
The Bluebird board of directors recommended that shareholders tender their shares in support of the transaction by 11:59 p.m., New York City time, on May 29, 2025, following which the tender offer would expire.
The company said that unless a majority of stockholders tender their shares, Bluebird is at significant risk of defaulting on its loan agreements with Hercules Capital, and it is extremely unlikely that stockholders would receive any consideration for their shares in a bankruptcy or liquidation.
On Stocktwits, retail sentiment around Bluebird rose within the ‘bullish’ territory while message volume jumped from ‘high’ to ‘extremely high’ levels.
BLUE stock is down by about 43% this year and about 77% over the past 12 months.
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