Skye Bioscience Announces Agreement to Acquire Redx Pharma; $67.9M Financing

What Happened

• On August 14, 2026, Skye Bioscience (SKYE) announced a Transaction Agreement to acquire Redx Pharma Limited via a UK scheme of arrangement. Under the deal, Redx shareholders will receive newly issued Skye common stock and/or new non‑voting common stock (convertible one‑for‑one), calculated by an Exchange Ratio tied to agreed valuations and Company cash at closing.
• The transaction is being done with a Concurrent Financing: Skye agreed to sell $67.9 million of stock (potentially up to $72.9M under certain conditions) immediately after the Effective Time. Redx also plans a Series A financing of $36.0 million prior to closing. Skye entered term sheets for an equity line (ELOC) up to $22.0M and will issue a $5.0M warrant to an investor affiliated with Redmile.
• The companies provided a pro forma ownership example (assuming the financings and certain valuation assumptions): pre‑Transaction Redx equityholders ~46.17%, pre‑Transaction Skye equityholders ~5.38%, and investors in the financings ~48.45% on a fully diluted basis. The Company valuation used for the Exchange Ratio is $14.5M (subject to Net Cash and other adjustments, with a $2.0M valuation floor if unresolved).

Key Details

• Transaction announced: August 14, 2026; closing conditions include shareholder approvals (Skye and Redx), UK court sanction of the scheme, Nasdaq listing maintained, and minimum Company Net Cash thresholds. Deadline to complete deal: August 14, 2027 (subject to limited extension).
• Concurrent Financing: $67.9M (may increase to $72.9M); Redx Series A Financing: $36.0M. ELOC up to $22.0M; $5.0M warrant to Redmile affiliate.
• Management/board changes expected post‑closing: Lisa Anson to be CEO; Peter Collum CFO; Mei Lun Wang CMO; Dr. Caroline Phillips CSO; Dr. Cliff Jones CTO. Current Skye execs and directors expected to tender resignations; Redx will designate directors for the combined company.
• Skye approved a 1‑for‑8 reverse stock split, effective ~12:01 am ET Aug 24, 2026, reducing outstanding shares from ~35.42M to ~4.43M (authorized shares reduced from 300M to 37.5M). Split rounds fractional shares down for cash payment.

Why It Matters

• This is a transformational acquisition for Skye: it would transfer control/ownership to a combined capital structure driven largely by the new financings, materially diluting current Skye shareholders (illustrative pro forma ownership shows Skye legacy holders ~5.4%). Investors should note the multiple financings and equity issuance that support the deal and fund operations but increase dilution.
• Closing is subject to many conditions (shareholder votes, UK court sanction, Nasdaq listing and cash thresholds). The Exchange Ratio and company valuation are adjustable based on Company Net Cash and a specified adjustment process, with a $2.0M valuation floor if unresolved—factors that affect final share issuance and investor ownership.
• Skye also adopted a 1-for-8 reverse split to regain Nasdaq minimum bid price compliance; that action does not change relative ownership materially but may affect liquidity and short‑term trading. The filing also creates contingent value rights (CVRs) for legacy Skye and Redx shareholders tied to potential future proceeds from specified legacy assets, which could provide limited future payouts but are uncertain and non‑transferable in most cases.

Keywords: merger, acquisition, financing, reverse stock split, Nasdaq compliance, dilution, contingent value rights, management change.