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Ginkgo agrees to $17.5b merger with Harry Sloan’s SPAC

An automated fermenting machine at the Ginkgo Bioworks Inc. facility in Boston.Scott Eisen/Bloomberg

Ginkgo Bioworks Inc., which calls itself an “organism design” company, has agreed to go public in a $17.5 billion merger with a blank-check firm backed by former Hollywood executive Harry Sloan.

The Boston-based company, which uses technology to program cells for a potentially wide variety of uses, will combine with Soaring Eagle Acquisition Corp., according to a regulatory filing Tuesday that confirmed an earlier Bloomberg News report.

The transaction includes a $775 million private placement led by Baillie Gifford, Putnam Investments and Morgan Stanley Investment Management’s Counterpoint Global arm. Cathie Wood’s Ark Investment Management LLC, Bain Capital’s public equity arm, Bill Gates’s Cascade Investment LLC and T. Rowe Price Associates Inc. are also participating in the fundraising, the statement shows.

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The deal values Ginkgo at $15 billion, before adding the proceeds raised by the special purpose acquisition company and other investors, according to the statement. The SPAC raised $1.73 billion including so-called greenshoe shares in an initial public offering in February.

The underlying principle of Ginkgo’s business is that biology is programmable in a way analogous to computers -- just using the four basic chemical building blocks of DNA sequencing instead of zeros and ones. The company can design mammal, bacteria and yeast cells to serve specific purposes.

During the past year, Ginkgo repurposed its technology to read and modify living cells to help address the shortfall of diagnostic testing.

Arie Belldegrun, who started Kite Pharma Inc. and Allogene Therapeutics Inc., co-sponsoring the merger transaction with Soaring Eagle and had bought equity in the SPAC and participated in the private placement. Belldegrun and Sloan, Metro-Goldwyn-Mayer’s former chairman, will join Ginkgo’s board as part of the agreement.

“We live in an era of evolution in biology and in life science,” Belldegrun, who was trained as an oncologist, said in an interview. “I believe that the greatest future opportunity of synthetic biology is in the area of biotech -- drug development and drug manufacturing.”

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Ginkgo was founded by a group of Massachusetts Institute of Technology graduate students and then-professor Tom Knight. Led by co-founder and CEO Jason Kelly, its investors have included funds and accounts advised by T. Rowe Price, Cascade Investment, Viking Global Investors and General Atlantic.

“If you find a company like Ginkgo, which we call a category of one -- meaning it’s not only the leader in the field but it created the field itself -- those companies make great sense as a SPAC,” Sloan said in an interview.

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