Nvidia-backed Recursion to acquire Exscientia in all-stock deal

Exscientia (NASDAQ:EXAI), an AI-driven drug discovery firm, has agreed to be acquired by its larger peer, Recursion Pharmaceuticals (NASDAQ:RXRX), whose backers include chipmaker Nvidia (NASDAQ:NVDA), in an all-stock deal. Salt Lake City, Utah-based Recursion (RXRX) announced the agreement with its Q2 2024 financials on Thursday.

Exscientia (EXAI) shares added ~8% in the premarket after the announcement while Recursion (RXRX) gained ~2%. 

Under the agreement, Exscientia (EXAI) shareholders will receive 0.7729 shares of Recursion (RXRX) Class A common stock for each ordinary share they hold. Fractional shares will be paid in cash.

Once the transaction is completed by early 2024, Recursion (RXRX) shareholders will own approximately 74% of the combined company, while Exscientia (EXAI) shareholders will own the rest.

Recursion (RXRX) will be the surviving entity led by co-founder and CEO Chris Gibson. Exscientia’s (EXAI) interim CEO David Hallett is expected to join as its chief scientific officer.

In July 2023, Recursion (RXRX) fueled a rally in AI-driven biopharma stocks after receiving a $50M investment from chipmaker Nvidia (NVDA). Its peers, Abcellera Biologics (ABCL), Absci Corporation (ABSI), Exscientia (EXAI), and Schrodinger (SDGR), also rallied in reaction.