Royalty Pharma Announces Shareholder Approval of its External Manager Acquisition

Core Viewpoint - Royalty Pharma plc has received overwhelming shareholder approval (99.9%) for its transition from an external management model to an integrated corporate structure, marking a significant milestone for the company [1][4]. Financial Impact - The internalization transaction is expected to generate cash savings exceeding $100 million in 2026 and over $175 million in 2030, with cumulative savings projected to exceed $1.6 billion over the next ten years [3][8]. - The total transaction value is approximately $1.1 billion, which includes 24.5 million shares of Royalty Pharma equity, $100 million in cash, and the assumption of $380 million in existing Manager debt [5][6]. Corporate Governance and Structure - The internalization is anticipated to enhance corporate governance, increase transparency, and align the leadership team more closely with shareholder interests [2][3]. - Following the transaction, all employees of the external Manager will become direct employees of Royalty Pharma, simplifying the corporate structure [7][8]. Shareholder Benefits - The acquisition is expected to strengthen shareholder alignment and ensure management continuity, with shares received by management vesting over 5 to 9 years [3][9]. - The internalization may also expand Royalty Pharma's shareholder base and enhance the company's valuation over time [3][8]. Background Information - Royalty Pharma has operated under an external management model since its founding in 1996, paying quarterly fees to the Manager based on portfolio receipts and security investments [7].