In a significant development for the hearing health industry, Eargo Inc, a prominent medical device company, announced today that it has entered into a definitive merger agreement with an affiliate of Patient Square Capital. This leading healthcare investment firm, also the principal shareholder of Eargo, will acquire all outstanding shares of Eargo common stock not currently held by Patient Square Capital for a cash consideration of $2.55 per share.
Following this announcement, Eargo’s stock witnessed an impressive surge of over 52%, reflecting the market’s positive response to the merger agreement. This surge comes as Eargo’s strategic focus on enhancing hearing health gains traction in the medical device sector.
At the time of this publication, Eargo Inc stock (EAR) has witnessed a surge.
Eargo Inc
Current Price: $2.56
Change : +0.88
Change (%): (52.38%)
Volume: 2.4M
Source: Tomorrow Events Market Data
The purchase price of $2.55 per share represents a premium of approximately 52% over the closing price of Eargo common stock on October 27, 2023, which marked the final trading day prior to the public disclosure of the transaction.
A specialized committee, known as the “Special Committee,” comprising solely of independent directors and supported by its own independent legal and financial advisors, unanimously recommended the transaction to the Board of Directors of Eargo. The Special Committee deemed this acquisition to be in the best interests of Eargo and its shareholders not affiliated with Patient Square or the company’s management and director shareholders. In alignment with this recommendation, the Board granted its approval for the transaction.
The transaction is anticipated to conclude in the first quarter of 2024, pending satisfaction of customary closing conditions. Upon finalization, Eargo will transition into a private entity, ceasing its public listing and trading on Nasdaq.
Patient Square has enlisted the legal expertise of Ropes & Gray LLP for this acquisition. Meanwhile, Perella Weinberg Partners LP is offering financial advisory services to the Special Committee, with legal counsel being provided by Davis Polk & Wardwell LLP.
This merger signifies a significant milestone in Eargo’s mission to revolutionize hearing health, combining the expertise of Patient Square Capital with Eargo’s cutting-edge medical device technology. The transaction is poised to shape the future landscape of the hearing health industry, setting a promising course for both companies and their stakeholders.
