Goodwin Procter LLP advised Valo Health on the deal, while Latham & Watkins LLP represented Khosla Ventures Acquisition Co.
Valo Health announced its definitive merger agreement with Khosla Ventures Acquisition Co., a special purpose acquisition company founded by affiliates of Khosla Ventures. The transaction values the combined company at a pro forma market value of approximately $2.8 billion. The combined company is anticipated to have a pro forma cash balance of approximately $750 million before deducting anticipated transaction expenses, including existing Valo cash of approximately $250 million as of the date hereof, approximately $333 million of net cash held in KVAC’s trust, after deducting deferred underwriting commissions and assuming no redemptions, and a $168.5 million private investment in public equity priced at $10 per share.
Institutional and strategic investors or their affiliates and existing Valo shareholders that have committed to participate in the PIPE include a leading integrated healthcare delivery network, Khosla Ventures, NG MGG Strategic, Caz Investments, and returning investors Koch Disruptive Technologies, Flagship Pioneering, Public Sector Pension Investment Board, Invus, State of Michigan Retirement Systems, HBM Healthcare Investments and Longevity Vision Fund. The closing of this transaction is anticipated to occur in the third quarter of 2021 and is subject to the approval of Khosla Ventures stockholders and the satisfaction or waiver of certain other customary closing conditions.
Valo Health is a technology company built to transform the drug discovery and development process using human-centric data and artificial intelligence (“AI”) computation. As a digitally native company, Valo aims to full integrate human-centric data across the entire drug development lifecycle into a single unified architecture, thereby accelerating the discovery and development of life-changing drugs while simultaneously reducing the cost, time, and failure rate.
The Goodwin team was led by Stuart Cable (Picture), Joseph Theis, Dan Espinoza, Stephanie Richards, Robert Dzialo, Kristin Eberhart and Talya Levi and included Cynthia Li, Blake Tyler, Adanna Uwazurike, Martha Koroshetz, Latrell Williams, Dan Karelitz, Matthew Dunay, Crescent Moran Chasteen, Brittany McCants, Regina Couto, Andre Amorim, Roger Cohen, Julie Tibbets, Olivia Uitto, Andrew Hess, Christina Lewis, Christina Bitter, Rich Matheny, Justin Pierce, Carrie Miller, Ce Li, Brian Mukherjee, Paul Jin, Kara Kuritz, Brady Cummins, Beth Withers and Jacqueline Klosek.
Latham & Watkins LLP represented Khosla Ventures Acquisition Co. in the transaction with a corporate deal team led by Bay Area partners Jim Morrone, Luke Bergstrom, and Brian Paulson, with associates Lauren Lefcoe and Trevor Bossi. Advice was also provided on intellectual property and data privacy and security matters by Bay Area partner Michelle Gross, with associate Ryan Sanders; on tax matters by Bay Area partner Kirt Switzer, with associate Jacob Meninga; on benefits and compensation matters by Bay Area partner Julie Crisp and Los Angeles counsel Aryeh Zuber, with associate Rachel Narowski; on healthcare regulatory matters by Washington, D.C. partner Elizabeth Richards and Bay Area counsel Betty Pang, with associate Kiera Murphy; and on antitrust matters by Washington, D.C. counsel Patrick English.
Involved fees earner: Aryeh Zuber – Dechert; Andre Amorim – Goodwin Procter; Christina Bitter – Goodwin Procter; Stuart Cable – Goodwin Procter; Crescent Moran Chasteen – Goodwin Procter; Roger Cohen – Goodwin Procter; Regina Couto – Goodwin Procter; Matthew Dunay – Goodwin Procter; Robert Dzialo – Goodwin Procter; Kristin Eberhart – Goodwin Procter; Daniel Espinoza – Goodwin Procter; Andrew Hess – Goodwin Procter; Paul Jin – Goodwin Procter; Daniel Karelitz – Goodwin Procter; Jacqueline Klosek – Goodwin Procter; Kara Kuritz – Goodwin Procter; Talya Levi – Goodwin Procter; Christina Lewis – Goodwin Procter; Ce Li – Goodwin Procter; Xiaoyue Li – Goodwin Procter; Richard Matheny III – Goodwin Procter; Brittany McCants – Goodwin Procter; Carrie Miller – Goodwin Procter; Brian Mukherjee – Goodwin Procter; Justin Pierce – Goodwin Procter; Stephanie Richards – Goodwin Procter; Joseph Theis Jr. – Goodwin Procter; Julie Tibbets – Goodwin Procter; Blake Tyler – Goodwin Procter; Olivia Uitto – Goodwin Procter; Adanna Uwazurike – Goodwin Procter; Bethany Withers – Goodwin Procter; Luke Bergstrom – Latham & Watkins; Trevor Bossi – Latham & Watkins; Julie Crisp – Latham & Watkins; Patrick English – Latham & Watkins; Lauren Lefcoe – Latham & Watkins; Jake Meninga – Latham & Watkins; Jim Morrone – Latham & Watkins; Kiera Murphy – Latham & Watkins; Rachel Narowski – Latham & Watkins; Michelle Gross – Latham & Watkins; Betty Pang – Latham & Watkins; Brian Paulson – Latham & Watkins; Elizabeth Richards – Latham & Watkins; Ryan Sanders – Latham & Watkins; Kirt Switzer – Latham & Watkins;