Ginkgo’s Insanely Great $15B Deal, The Who & How Behind Biggest Sector Deal Ever
In Massachusetts, Ginkgo Bioworks and Soaring Eagle Acquisition Corp. have agreed to a business combination that will result in Ginkgo becoming a publicly-listed company. The transaction is expected to close in the third quarter of 2021.
The $15B valuation and $2.5B to Ginkgo in proceeds
The transaction implies a pre-money equity valuation for Ginkgo of $15.0 billion, and is expected to provide up to $2.5 billion of gross cash proceeds. Gross proceeds include Soaring Eagle’s $1.725 billion of cash in trust (subject to any redemptions by Soaring Eagle’s public shareholders) and $775 million in proceeds from a PIPE transaction priced at $10.00 per share of Class A common stock of Soaring Eagle to be funded immediately prior to the closing of the transaction.
The backers
Eagle Equity Partners is co-sponsoring the transaction with Bellco Capital, led by Dr. Arie Belldegrun. Dr. Belldegrun is a leader in the field of cell and gene therapy and founder of Kite Pharma and Allogene Therapeutics. Both co-sponsors are also investing in the PIPE. The PIPE is being led by Baillie Gifford, Putnam Investments, and funds and accounts managed by Counterpoint Global (Morgan Stanley Investment Management) and with additional participation from new and existing investors including accounts advised by ARK Investment Management LLC, ArrowMark Partners, Bain Capital Public Equity, Berkshire Partners, Cascade Investment, Casdin Capital, Franklin Advisers, funds and accounts advised by T. Rowe Price Associates, Inc., and Viking Global Investors.
In connection with the closing of the transaction, Soaring Eagle intends to change its name to Ginkgo Bioworks Holdings, Inc., change its jurisdiction of formation to Delaware and list under a new ticker symbol.
A recent McKinsey Global Institute report estimated that the overall market for bioengineered products from which Ginkgo could receive a value share is estimated to reach $2 to $4 trillion in the next 10 to 20 years. The capital raised in this transaction will dramatically increase the scale of Ginkgo’s platform and empower an ecosystem for cell programmers, accelerating the number of new programs able to launch on Ginkgo’s platform every year. Today, industry sources estimate companies spend approximately $40 billion per year on biotech R&D work, work that could be supported by Ginkgo’s platform.
The transaction will require the approval of the stockholders of both Soaring Eagle and Ginkgo, and is subject to other customary closing conditions, including the receipt of certain regulatory approvals.
The Ginkgo backstory
South by Yeast: Ginkgo acquires a venture that Sputtered but Never Failed to Intrigue
Movements at Ginkgo BioWorks, Pacific Ethanol, Lygos, LanzaTech show where the bioeconomy is heading
Ginkgo’s insane $275M venture haul says it loud: Digital Biology is here
The Board chair re-shuffle
Ginkgo will continue to be led by co-founder and CEO Jason Kelly and co-founder and President/COO Reshma Shetty and will retain the rest of the Ginkgo founding team, including Chief Technology Officer Barry Canton, Head of Strategy Austin Che, and the “godfather of synthetic biology”, DNA Hacker Tom Knight.
In addition to Kelly and Shetty, the board of directors will be led by a group of deeply experienced operators and public company executives, including Marijn Dekkers, who previously served as CEO of Bayer and Thermo Fisher Scientific and as Chairman of Unilever; Arie Belldegrun, chairman of Bellco Capital, founder and CEO of Kite Pharma until its acquisition, and co-founder and executive chairman of Allogene Therapeutics; Christian Henry, the CEO of Pacific Biosciences and Former CFO/Chief Commercial Officer of Illumina; Shyam Sankar, the COO of Palantir; Harry Sloan, the CEO of Eagle Equity Partners, former Chairman and CEO of Metro-Goldwyn-Mayer (MGM), and founder and former CEO of SBS Broadcasting.
Reaction from the stakeholders
“The magic of biology is that cells run on digital code similar to a computer, except that instead of 0s and 1s it’s As, Ts, Cs, and Gs,” said Jason Kelly, co-founder and CEO of Ginkgo Bioworks, Inc. “Ginkgo’s platform makes it easier to program this code, and we are making this platform available to organizations working to solve our most pressing problems. From mRNA vaccines reaching people’s arms to combating climate change, the opportunity to work with programmed cells has never been more apparent. We are thrilled to partner with Arie as well as the team at Soaring Eagle to bring this vision to life.”
“Eagle Equity Partners continues to focus on companies that are in a category of one,” said Harry E. Sloan, CEO of Soaring Eagle. “Ginkgo is not only a leader in this field, but its founders launched the modern practice of synthetic biology. There has never been a more critical time to employ Ginkgo’s technological achievements and efficiencies toward solving so many real-world problems—environment, food, and health to name a few. We’ve been so impressed with Jason and his co-founders’ sense of purpose and we believe that this team will be the ambassadors of these advances for decades to come.”
“We are at the beginning of a new era in scientific innovation, where industries which once worked in silos now come together to address challenging issues and improve human health,” said Arie Belldegrun, M.D., FACS, co-founder of Bellco Capital. “At Bellco and across our portfolio of biotechnology companies and investments, we have seen first-hand how the ability to program cells has started to revolutionize how we treat disease with the birth of cell and gene therapies. I am excited to join the Ginkgo family as a board member, with the hope of expanding use of Ginkgo’s state-of-the-art technology to assist biopharma companies and expedite drug development.”
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