Covington Advises Novartis in its Pending Acquisition of Avidity Biosciences

WASHINGTON—Covington represented Novartis in its entrance into an agreement to acquire Avidity Biosciences, Inc. (Nasdaq: RNA), a San Diego-based biopharmaceutical company focused on a new class of therapeutics enabling RNA delivery to muscle.

Under the terms of the transactions, Novartis, through a merger with a newly formed indirect wholly owned subsidiary, will acquire all outstanding shares of Avidity. Pursuant to the terms of the merger agreement, holders of Avidity common stock will receive $72.00 per share in cash at closing, valuing the company at approximately $12 billion on a fully diluted basis and representing an enterprise value of approximately $11 billion at the expected closing date. Prior to the closing of the merger, Avidity will transfer to SpinCo, a wholly owned subsidiary of Avidity, the early-stage precision cardiology programs and collaborations of Avidity. Holders of Avidity common stock will receive (1) a distribution of one share of SpinCo for every ten shares of Avidity they hold and/or (2) a pro rata cash distribution of the proceeds received by Avidity prior to the closing if certain SpinCo assets are, or SpinCo itself is, sold to a third party.