XOMA Royalty Corp 8-K

What Happened
XOMA Royalty Corporation (XOMA) announced on April 27, 2026 that it entered into an Agreement and Plan of Merger with Ligand Pharmaceuticals Incorporated and a Ligand subsidiary, under which Ligand’s merger subsidiary will merge with HoldCo (a newly formed HoldCo of XOMA) and HoldCo will survive as a Ligand subsidiary. At closing each outstanding XOMA common share will convert into: (i) $39.00 in cash per share (no interest, net of withholding) and (ii) contingent value rights (CVRs) that give holders the right to receive contingent payments derived from a trust’s 75% interest in a spun-off RemainCo LLC. The XOMA Board unanimously approved the Merger Agreement and recommended that stockholders vote to approve the transaction.

Key Details

• Merger consideration: $39.00 cash per common share plus CVRs (contingent value rights) tied to the CVR Trust’s interest in RemainCo LLC.
• Corporate steps: a Holding Company Reorganization will convert XOMA into a HoldCo structure, followed by a CVR Spin (transfer of assets, conversion of XOMA into RemainCo LLC, contribution of 75% of RemainCo units to a CVR Trust, issuance of CVRs).
• Approvals & conditions: closing is subject to XOMA stockholder approval (majority of voting power under NRS 92A.120(5)), expiration/termination of the HSR waiting period, and completion of the HoldCo Reorganization and CVR Spin. Ligand’s obligations are not conditioned on financing.
• Support: certain XOMA officers, directors and BVF-affiliated funds (Supporting Stockholders) signed Support Agreements and beneficially owned ~47% of outstanding shares as of April 27, 2026.
• Other terms: Series X preferred converts into the right to receive the same merger consideration (on a conversion basis); Series A and B perpetual preferred will be redeemed per their terms. A $40 million termination fee applies in specified circumstances; the agreement contains a drop-dead date provision (outside date of January 26, 2027) and customary termination and matching rights.

Why It Matters
For XOMA stockholders this is a definitive sale agreement that provides immediate, stated cash value of $39.00 per share plus potential additional contingent upside through CVRs tied to the spun-off business (RemainCo). The Board’s unanimous recommendation and support agreements representing ~47% of shares increase the likelihood the deal will be approved, but the transaction still requires a shareholder vote and regulatory clearances. Ligand’s lack of a financing condition reduces the risk that the buyer will walk for lack of funds, while the CVR structure preserves potential future value tied to the assets placed in RemainCo. Investors should review the forthcoming proxy statement and related SEC filings for full details before voting.