Human Longevity To Go Public Through SPAC at $1 Billion Valuation

Editor’s Note: Since spannr published this piece, Human Longevity confirmed in a press release their intent to combine with Freedom Acquisition.

Human Longevity Inc. is “in advanced talks” to merge with Freedom Acquisition Corp, a $345 million special purpose acquisition company (SPAC), at an implied valuation of ~$1 billion.

Based in San Diego, California, Human Longevity was launched in 2013 by Peter Diamandis, Robert Hariri, and Craig Venter.

Diamandis and Harari had previously co-founded Celularity (CELU), which went public in another SPAC merger after raising more than $400 million. The stock is down more than 60% since going public in July 2021.

According to Pitchbook, Human Longevity has raised more than $500 million and was at one point valued at approximately $1.6 billion. At an implied valuation of $1 billion, the SPAC represents a more than 37% decrease in valuation from 2017.

Past investors, some of which could be seeing a negative return on investment, include BB Retail Capital, Celgene Corp, Draper Fisher Jurvetson, Emerging Technology Partners LLC, Faridan Ventures (out of business), GE Ventures, Genting Berhad, Illumina, and OS Fund.

Illumina (ILMN), in particular, has led multiple rounds, including the $80 million Series A in 2014, whose share price is up only 10% since that time.

Human Longevity is reported to go public through a combination with the $345 million blank check company, Freedom Acquisition Corp (FACT). The SPAC was established by Tidjane Thiam, a former Credit Suisse, and Prudential chief executive, in February 2021 with the stated goal of merging with a company in the financial services sector.

On June 10, 2022, Freedom Acquisition Corp announced that it was splitting up with co-sponsor Pimco and would work instead with NextG Tech Limited, an affiliate of Chinese entrepreneur Edward Zeng’s advisory firm China Bridge Capital.

Pimco had recently disapproved of a merger between FACT and Credijusto, a Mexican fintech company focused on small business lending, due to valuation disagreements. Because of the unique nature of SPACs having a limited time frame to make a deal before they have to return invested capital, Thiam may have been feeling the pressure to get a deal done even though Human Longevity is not in the financial services sector.

Launched in 2013, Human Longevity Inc. had ambitious goals of building the “world’s most comprehensive database on human genotypes and phenotypes” to “tackle the diseases associated with aging-related human biological decline.”

To drive revenue, the company initially sought to provide analytics to pharmaceutical companies as the process of drug development was increasingly relying more on genetic sequencing.

While database licensing has been somewhat successful – signing multi-year partnerships with AstraZeneca and life insurance companies such as Massachusetts Mutual and Discovery along the way – Human Longevity has more recently been focused on helping its clients live to be 100 via its Health Nucleus membership program.

The membership, with prices ranging from ~$5,000 to $20,000 per year, offers AI-assisted health assessments, genomic insights, and advanced longevity healthcare that enables patients to stay ahead of age-related diseases.

If the merger is to go through, it will be telling how FACTs investors respond to the deal. FACT is currently trading at $9.82 per share.

With the SPAC and biotech market facing significant headwinds in the current macroeconomic environment, we expect a non-trivial number of investors to ask to redeem their stock.

Although SPAC redemptions across the industry have decreased in recent months, they have been as high as 90% this year, meaning that Human Longevity could receive significantly less than the $345 million pledged by Freedom Acquisition.