BIOTA BUYS NABI FOR ITS $52m CASH, NASDAQ LISTING
April 24th 2012 01:33
Monday April 23, 2012
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Pending shareholder approvals, Biota will acquire Nabi Biopharmaceuticals for a backdoor listing on Nasdaq, acquiring $US54 million in cash and be headquartered in the US.
Biota said it was proposed that the Rockville, Maryland-based Nabi acquire all of Biota's shares and Biota delist from the ASX.
In a media teleconference, Biota chairman Jim Fox said that the merger would provide Biota with $US54 million ($A52.4 million) in cash and a Nasdaq listing.
Mr Fox said that Biota gave a zero value to Nabi’s drug pipeline which included the revenue-generating drug Phoslyra for the control of hyperphosphataemia in end-stage renal failure, as well as an anti-smoking vaccine Nicvax, which had not met the primary endpoints of a phase III trial, but was currently in a combination trial.
Nabi's market capitalization on April 20, 2012 was $US79.3 million ($A76.5 million), according to the Nasdaq, while Biota's ASX market capitalization was $A172 million.
Biota chief financial officer Damian Lismore told Biotech Daily that Nabi had more than $US90 million in cash which would be used to pay debt and a return to Nabi shareholders, with Biota effectively raising the $US54 million balance at a 16 percent discount to Biota’s closing price at April 20, 2012.
Mr Fox said that Biota’s Australian and Oxford, UK operations would continue largely unchanged with 65 and 10 research staff, respectively.
He said that chief executive officer Peter Cook would retire, the chief executive officer and chief financial officer roles would move to the US and the company was looking for a chief executive officer known to the US markets.
Mr Fox said that despite the $US231 million US Office of Biomedical Advanced Research and Development Authority (BARDA) contract to further develop its laninamivir anti-influenza drug, available in Japan as Inavir, the deal was not reflected in the company’s share price (BD: Apr 1, 2011).
He said that listing on Nasdaq would provide Biota with “access to bigger and deeper capital markets … [and was] simply altering where shares are traded”.
In its media release, Biota said that following the merger it would have three royalty generating products, Relenza, Inavir and potentially Phoslyra; the BARDA contract; a portfolio of clinical and pre-clinical programs comprising vapendavir for human rhinovirus, programs for respiratory syncytial virus, hepatitis C, broad spectrum antibiotic targeting gyrase; and an interest in Nicvax and more than $US100 million in cash.
Mr Lismore told Biotech Daily that BARDA was responsible for purchases of Relenza to the US stockpile and said “it is a lot easier for BARDA to put an order on a US company”.
Biota said the merger, through a scheme of arrangement, would require approval from both Biota and Nabi shareholders and independent reports, along with other conditions.
Biota’s major shareholders are Hunter Hall with 13.66 percent and the US-based Landon Clay with 11.33 percent.
Nabi will acquire all of Biota’s shares in exchange for new shares in the name of the Nasdaq listed Biota Pharmaceuticals and Biota would be de-listed from the ASX.
The company said that on completion of the merger, current Biota shareholders would own about 74 percent of Biota Pharmaceuticals and Nabi shareholders would own about 26 percent.
Biota said the board would have six former Biota directors including chairman Jim Fox and two Nabi directors, with Mr Cook and Mr Lismore continuing for the time being.
Biota said it expected the deal to close by September 30, 2012.
Biota said it would hold investor briefings in Melbourne, Brisbane and Sydney in the coming week.
Biota fell 8.5 cents or nine percent to 86 cents with 2.2 million shares traded.
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