Keros Therapeutics (KROS) Announces Review of Strategic Alternatives

Keros Therapeutics, Inc. (Nasdaq: KROS), a clinical-stage biopharmaceutical company focused on developing and commercializing novel therapeutics to treat a wide range of patients with disorders that are linked to dysfunctional signaling of the transforming growth factor-beta (“TGF-ß”) family of proteins, today announced that its Board of Directors (the “Board”) has determined to initiate a formal review process to evaluate strategic alternatives to maximize stockholder value for the Company. In connection with this determination, the Board has authorized the formation of a committee, consisting of independent and disinterested directors, to oversee the process (the “Strategic Committee”) and make a recommendation to the full Board. The Strategic Committee, with the assistance of outside financial and legal advisors, intends to consider a comprehensive range of strategic alternatives, including but not limited to a sale of the company or other business combination transaction, continued investment in the Company’s pipeline, and/or return of excess capital to stockholders.

“Consistent with our commitment to taking action to enhance stockholder value, Keros’ Board determined to undertake a review of all strategic alternatives available to the Company,” said Jean-Jacques Bienaimé, Lead Independent Director. “During the pendency of the strategic review process, we remain focused on the execution of our strategy.”

There can be no assurance that this process will result in the Company pursuing a transaction or any other strategic outcome. There is no deadline or definitive timetable set for completion of the strategic alternatives review process. Keros intends to provide a preliminary update regarding the status of the process within 60 days of this announcement. Otherwise, Keros does not intend to disclose developments related to the process unless and until it determines that further disclosure is appropriate or necessary.

Adoption of Stockholder Rights Plan

The Company also announced that the Board has adopted a limited-duration stockholder rights plan (the “Rights Plan”), effective immediately. The Board adopted the Rights Plan in response to significant and rapid accumulations of the Company’s common stock by a number of investors who have indicated a desire to influence the control of Keros, including an individual investor which has informed the Company that it holds 11.2% of Keros’ outstanding common stock as of April 6, 2025.

The Rights Plan is intended to protect the interests of the Company and its stockholders, help ensure that all interested parties have the opportunity to participate fairly in the strategic review process and to provide the Board time to make informed decisions. The Rights Plan will reduce the likelihood that any entity, person or group gains control of Keros through open-market accumulation without paying all stockholders an appropriate control premium. The Rights Plan does not preclude the Board from engaging with parties or considering proposals or other strategic alternatives that it believes recognize the full value of the Company and are in the best interests of Keros and all stockholders.

The Rights Plan, which is similar to other plans adopted by publicly held companies, does not contain any dead-hand, slow-hand, no-hand or similar feature that limits the ability of a future Board to redeem the rights.

In connection with the adoption of the Rights Plan, the Board declared a dividend of one preferred share purchase right for each outstanding share of the Company's common stock as of the close of business on April 24, 2025, the record date. Under the Rights Plan, the rights will become exercisable if an entity, person or group acquires beneficial ownership of 10% or more (15% in the case of passive institutional investors) of Keros’ outstanding common stock in a transaction not approved by the Board. In the event that the rights become exercisable due to the ownership threshold being crossed, each right will entitle its holder (other than the person, entity or group triggering the Rights Plan, whose rights will become void and will not be exercisable) to purchase additional shares of common stock having a then-current market value of twice the exercise price of the rights. Any stockholders with beneficial ownership of the Company’s outstanding common stock at or above the applicable threshold prior to this announcement are grandfathered at their current ownership levels but are not permitted to increase their ownership without triggering the Rights Plan. In addition, the Rights Plan has customary flip-over and exchange features.

Subject to the terms of the Rights Plan, the rights will expire on April 9, 2026 unless the rights are earlier redeemed or exchanged by Keros.

Additional information regarding the Rights Plan will be contained in a Form 8-K to be filed by Keros with the U.S. Securities and Exchange Commission.

Goldman Sachs & Co. LLC is serving as Keros’ financial advisor, and Cooley LLP is serving as legal counsel.

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