Societal CDMO, a contract development and manufacturing organization (CDMO) dedicated to solving complex formulation and manufacturing challenges primarily in small molecule therapeutic development, has signed a sales and purchase agreement to sell approximately 121 acres of lakefront land to David Weekley Homes, an established homebuilder, for $9,075,000.00. The land is located adjacent to Societal’s manufacturing facility in Gainesville, GA, and is being sought by David Weekley Homes, which operates in 19 cities across the U.S., for residential development. The closing of the sale is subject to completion of standard due diligence and other customary conditions. Subject to completion of diligence, Societal CDMO expects the sale to close in the second half of 2023 and intends to use the proceeds from the sale to strengthen its balance sheet by paying down a portion of its outstanding debt.

“A core component of Societal’s forward-looking growth strategy is the continuous strengthening of our balance sheet to provide the company the sturdiest foundation from which to operate. Our ownership of these approximately 121 acres of lakefront property provides Societal CDMO the unique opportunity to monetize a valuable, non-core business asset and utilize the capital that is generated to offset a portion of the company’s debt,” said Ryan Lake, chief financial officer, Societal CDMO. “We believe that this is a particularly prudent move in light of the challenging economic environment that is currently impacting not only those in the life sciences industry but the broader global market. We look forward to the closing of this transaction and continuing to execute against our broader corporate growth strategy.”

Societal CDMO is also in the process of pursuing a second real estate transaction intended to further strengthen the company’s financial position. This second transaction is focused on the sale and lease back of its buildings and a portion of the company’s remaining land on its Gainesville campus. Discussions with prospective buyers are advancing and the company is aiming to close the sale and lease back deal by the end of 2022. The company expects the total proceeds from both real estate transactions to be between $40 million and $50 million, and intends to utilize these proceeds to reduce its debt and significantly improve its debt capital structure, putting the company on a path toward refinancing the debt at a lower cost of capital.