The companies said on Tuesday that Biotech ProKidney LP will merge with blank check firm backed by experienced dealer Chamath Palihapitiya and will value the combined venture at $ 2.64 billion.
The merger with Social Capital Suvretta Holdings Corp III will give ProKidney a total revenue of up to $ 825 million to develop chronic kidney disease treatment.
The proceeds include a $ 250 million form raised through an initial public offering (IPO) in July and a $ 575 million private equity investment in state capital, or PIPE.
PIPE investors include Palihapitia Social Capital, Suvretta Capital’s health-focused Averill Fund, and existing shareholders of ProKidney.
ProKidney says its technology has the potential to treat chronic kidney disease by using it to restore organ function from a patient’s own cells.
Palihapitia, often known as the “King of SPAC,” has sponsored some top-tier blank check deals, including fintech SoFi Technologies Inc. and home sales platform Opendoor Technologies Inc.
He said that despite the slowdown in blank check consolidation activity in the second half of 2021, the industry is stable over the long term.
Blank-check firms, or special-purpose purchasing companies (SPACs), are investment instruments that are publicly traded, which allows a private company to merge publicly, thereby bypassing a traditional IPO.
The ProKidney deal is expected to close in the third quarter of this year, after which the combined company will be listed on the Nasdaq under the “PROK” label.
Interviews by Niket Nishant and Sohini Podder in Bengaluru; Edited by Aditya Soni