Murphy Canyon Acquisition Corp. (MURF) Merger with Conduit Pharmaceuticals (Private)

Research / By

November 10, 2022

  • Murphy Canyon Acquisition Corp. (MURF) to acquire Conduit Pharmaceuticals (private) in a transaction valuing the combined company at an enterprise value of $700.49 million ($849.85 million of equity value).
  • Conduit shareholders will receive $650 million of equity consideration at $10.0/share.
  • Transaction is supported by $27.0 million PIPE (MURF Units at $10.0/share).
  • Minimum gross cash condition of $27.0 million.
  • No termination fee or expense reimbursement.         
  • The business combination transaction is targeted to close in the first quarter of 2023.
  • SPAC Details:
    • Unit Structure: 1 share of Class A common stock + 1 redeemable warrant
    • #Cash in Trust: $135,706,687 (102.6% of Public Issue)
    • Public Shares outstanding: 13,225,000 shares
    • Private Shares Outstanding: 4,060,250 shares (including 754,000 shares contained in Units)
    • Reported Trust Value/ Share: $10.26
    • Liquidation Date: February 7, 2023
    • Outside Liquidation Date: August 7, 2023
  • Name of Target: Conduit Pharmaceuticals Limited
  • Description of Target: Conduit is a clinical stage specialty biopharmaceutical company, addressing unmet medical needs in the areas of autoimmune disease and idiopathic male infertility. The development pipeline includes a glucokinase inhibitor in a number of Phase 2 ready autoimmune diseases including uveitis, Hashimoto’s Thyroiditis, preterm labor and renal transplant. Conduit’s development pipeline also includes a potent, irreversible inhibitor of human Myeloperoxidase (MPO) that has the potential to treat idiopathic male infertility.
  • Announced Date: November 8, 2022
  • Expected Close: “First Quarter of 2023”
  • Press Release: https://www.sec.gov/Archives/edgar/data/1896212/000149315222030981/ex99-1.htm
  • Transaction Terms (https://www.sec.gov/Archives/edgar/data/1896212/000149315222030981/ex99-2_009.jpg):
    • Enterprise Value: $700.49 million
    • Equity Value:$849.85 million
    • Target Shareholders Receive (~76.48%):
      • $650 million of Equity consideration (65 million shares of MURF Class A Common Stock at $10.0/share)
  • PIPE / Financing:
    • $27 million of PIPE (Units of MURF at $10.0/share)
      • 1 Unit = 1 share of Common Stock + 1 redeemable warrant
      • Exercise Price of Warrant = $11.5/share
      • Exercise Period of Warrant = 5 Years post-closing
      • Investor agreed to restrict its ability to exercise the Warrants such that the number of shares held by Investor (and its affiliates) after such exercise does not exceed 4.99% of issued & outstanding shares of MURF Common Stock at that time
  • Redemption Protections:
    • None
  • Support Agreement:
    • Standard voting support
  • Lock-up:
    • SPAC Sponsors: 180 days post-closing
      • Early Release: If price equals or exceeds $12.00 per share after 90 days post-closing
    • Key Target Shareholders: 180 days post-closing
  • Closing Conditions:
    • Minimum gross cash condition of $27 million
      • Cash includes:
 Cash in Trust
Less:Redemptions
Add:PIPE Financing
  • Termination date: May 31, 2023
  • SPAC must agree to a new equity incentive plan with an initial share reserve ≤ 10% of MURF fully diluted common stock post-closing
  • Other customary closing conditions
  • Termination:
    • No termination fees or expense reimbursement
    • Standard termination clauses
  • Advisors:
    • Target Legal Advisors: Thompson Hine LLP
    • SPAC Legal Advisors: Sichenzia Ross Ference LLP
    • SPAC and Target Financial Advisor: Alliance Global Partners
  • Financials (N/A):
    • No historical or projected financials provided
  • Comparables (N/A):
    • No Valuations Provided
  • Company Incentive Plan:
    • Initial share reserve ≤ 10% of MURF fully diluted common stock post-closing

*Denotes estimated figures by CPC

#Reported as on September 30, 2022