💥New Chapter 11 Bankruptcy Filing - Sangamo Therapeutics Inc. ($SGMO)💥
Company files to pursue a series of asset sales (and also has competing DIP bidders).
On June 23, 2026, Cali-based neurology-focused genomic medicine company Sangamo Therapeutics ($SGMO) (the “debtor” and along with three wholly-owned non-debtor subsidiaries, the “company”) filed a chapter 11 sale case — with two stalking horses teed up! — in the District of Delaware (Judge Goldblatt). You know we love these science-y cases!!
Actually, in case you don’t really remember: we don’t.
We REALLY don’t.
In fact, we hate these types of cases so much that we’re going to let that there 👆description of the company — yes, those five lonely words, “neurology-focused genomic medicine company” — be the sum total of our company-description. Though 👏🏼 to Cooley LLP’s Cullen Speckhart for providing as comprehensible an explanation of the debtor’s history, product line and future prospects at the June 24th first day hearing as humanly possible. Want to know more? Want to be a buyer? Read this. And spare Johnny a therapy appointment (or three).
The upshot is that this filing is teed up to be a series of sales. One, there’s a proposed sale of what the debtor calls its “Technology Platforms” and the “Prion Disease Program” to Eli Lilly and Company ($LLY)(“Lilly”) as stalking horse for $50mm (via a wholly-owned acquisition sub dubbed Merope Acquisition Sub LLC). Two, there’s a proposed sale of what the debtor has dubbed its “Fabry Disease Program” to Astellas Gene Therapies, Inc. (“Astellas”) for $25mm upfront plus a potential $25mm upon the debtor hitting certain milestones. And, three, there’s everything else (the debtor’s Chronic Neuropathic Pain Program, Hemophilia A Program, the Sickle Cell Disease Program, and the Tregs Platform). There’ll be a post-petition sale and marketing process for the whole kitten caboodle pursuant to a bidding procedures motion the debtor already has on file (on attempted shortened notice to boot, discussed 👇). That said, the debtor, as Ms. Speckhart put it, “…is open to all potential restructuring pathways, including reorganization structures and M&A transactions, and we will begin to assess [the debtor’s] options through the sale process where Lilly and Astellas will help us set the floor for what we anticipate will be a competitive bidding environment.”
To power this process, the debtor has a $30mm new money DIP term loan committed to by Northridge ATM LLC (“Northridge”)($10.5mm interim).* Great, right? Even better is that there are competing DIP proposals here that teed up quite a bit of 11th hour drama for the debtor and Ms. Speckhart’s team in the days leading up to the filing. Indeed, a company called Future Solutions Investments LLC (“FSI”) reached out, initially with a non-binding DIP term sheet, but the company’s restructuring committee ultimately decided that it was too late and too risky to change DIP lenders at that late juncture — particularly in light of the intertwined sequencing of APAs with Lilly and Astrellas, and the debtor’s dire cash position.** After the cases filed, however, the committee re-engaged with FSI (at FSI’s request) and FSI provided a binding term sheet, redlining its offer against what the debtor had already filed with the court re: Northridge with some improved economics (discussed 👇).
FSI allegedly wasn’t done; it also indicated, at least according to Ms. Speckhart, that it would be interested in becoming the owner of 100% of the debtor’s equity — in part to take advantage of the company's significant net operating losses. Hence the statement, “open to all potential restructuring pathways.”
Given this, a good portion of the first day hearing dealt with the DIP motion. After a clean if not somewhat robotic presentation by Cooley’s Olya Antle in which, among other things, Ms. Antle noted DIP economics that include, as highlights, a 12% interest rate (cash, monthly), a 2% commitment fee (or $600k, upon interim), a 5% exit fee (or $1.5mm, upon interim) and a $75k one-time work fee that had already been paid prior to the petition date,*** FSI’s counsel, KTBS Law LLP’s Nir Maoz first took issue with Ms. Antle’s contention that the debtor’s had run a truly competitive DIP process before subsequently (even-more-robotically) delving into how he believed that FSI’s DIP proposal was “better.” Specifically, he noted a reduced interest rate from the proposed 12% to 11% and the elimination of the commitment and exit fees ($2.1mm in savings — BOOM!); he also indicated willingness on FSI’s part to waive any mandatory pre-payment premium which would, of course, provide the debtor with the flexibility it clearly desires to run its process.****
Game over, right?
Not so fast. Sh*t be intertwined, remember? Also, as a third-party with no other interest in the case, FSI didn’t exactly have the best standing argument to pursue some sort of objection.