Sanofi Set to Take a 4.9% Stake in Novavax for $70 Million

Shah Capital has announced the withdrawal of its campaign against the re-election of three directors on Novavax's board following the COVID-19 vaccine maker's licensing deal with Sanofi. The deal, signed on May 10, entails Sanofi taking a 4.9% stake in Novavax for $70 million at a substantial valuation, including an upfront cash payment of $500 million and future payments contingent on specific milestones and royalties. This move comes after Novavax ( NVAX ) struggled to bring its protein-based vaccine to the market in a timely manner. Furthermore, the company has removed a warning notice from February last year, which cast doubt on its ability to continue operations, signaling increased stability after the deal with Sanofi.

Shah Capital, which holds approximately 7.8% stake in Novavax ( NVAX ),said that the Sanofi agreement represents a "long-awaited step in the right direction." Despite the withdrawal of its campaign, the fund continues to assert that Novavax ( NVAX ) would benefit from the addition of a stockholder representative on its board.

Novavax ( NVAX ) has reaffirmed its commitment to driving long-term value for all shareholders and has welcomed the decision by Shah Capital to end its campaign, deeming it as the right choice for shareholders and the company.
Moreover, Shah Capital remains vigilant, stating its belief that significant additional value remains to be unlocked at Novavax ( NVAX ).

Technical Outlook
The Maryland-based biotech company's stock rose approximately 8.53% to $14.21 in premarket trading, marking an almost threefold increase in value this year.
Novavax ( NVAX ) stock has a Relative Strength Index (RSI) of 79.87 which is quite overbought with the asset trying to maintain the new Resistance Level reached by it.

Additionally, as of April 30, the stock's short interest stood at 32% of publicly available shares, according to analytical Data firm LSEG data.