Revance Therapeutics (NASDAQ: NASDAQ:RVNC) experienced a significant drop, trading down approximately 17%, amid investor concerns over the potential collapse of its deal with Crown Labs.
The anxiety stems from the missed initiation of the tender offer, which was scheduled for September 13, 2024, but did not take place as expected.
Mizuho has reiterated its Neutral rating on Revance Therapeutics, maintaining the stock's price target at $6.66. The financial institution's stance comes in the wake of the company's failure to launch the anticipated tender offer on the slated date.
Mizuho's analysis suggests that this missed deadline should be seen as a mere delay rather than an indication that the deal with Crown Labs is falling through.
The absence of a formal explanation from Revance Therapeutics for not proceeding with the tender offer on the expected date has created uncertainty among investors.
Mizuho's commentary highlights that this lack of communication could continue to weigh on the company's stock performance in the short term.
Despite the recent downturn in trading, Mizuho anticipates that the agreement between Revance and Crown Labs will eventually be finalized. However, the current market sentiment reflects the impact of the unmet deadline and the company's silence on the matter.
Revance Therapeutics has not provided any public clarification regarding the delay of the tender offer, a factor that may contribute to ongoing investor skepticism. Mizuho's current analysis indicates that the deal completion is still on the horizon, despite the recent hiccup and resultant market reaction.
In other recent news, Revance Therapeutics has been making significant strides in its business operations. The biotechnology firm's product, DaxinbotulinumtoxinA for Injection, has been approved by China's National Medical Products Administration for the treatment of frown lines.
This approval marks a crucial expansion of Revance's dermatological product into the Chinese market. In addition, the company reported a 20% year-over-year increase in its total net revenue, reaching $65.4 million in the second quarter, primarily driven by a 65% increase in units sold and a 27% rise in net product revenue in its aesthetics division.
Revance is also set to merge with Crown Laboratories, a private global skincare company, in a deal valued at approximately $924 million. This strategic move has received unanimous approval from the Revance Therapeutics board and is expected to close by the end of the year.
However, the merger announcement has led to downgrades of Revance's stock rating by financial services firms William Blair and Stifel to Market Perform and Hold, respectively.
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