Maryland company Nabi Biopharmaceuticals recently announced that it will merge with an Australian company known as Biota Holdings Limited. The merger will result in a combined company called Biota Pharmaceuticals. The company's executives hope the move will allow the new company to easily reach "a stronger U.S. Biotechnology shareholder base." The company says the move will also help it gain better liquidity and value recognition.
Nabi Biopharmaceuticals, which is based in Rockville, will allow its shareholders to remain with the new company and participate in its "potential growth." According to the deal's sales terms, Nabi shareholders will also be offered a "return of significant cash, as well as a contingent value right providing payment rights arising from future sale." Nabi's president and CEO called the deal "an exciting opportunity" for shareholders, claiming it will "trigger the distribution of significant cash to current Nabi shareholders."
Meanwhile, Biota's chairman spoke on the benefits of public trading for the new company, which will be listed on the NASDAQ stock exchange. "A NASDAQ listing provides Biota with access to the largest healthcare capital market in the world and will enable us to transform our business model to one which can deliver significantly higher value than the royalty-only model we have historically pursued," explained the chairman.
Once the deal closes, the combined company will own three biopharmaceutical programs that generate revenue from royalties. It has also secured a $231 million contract with the Biomedical Advanced Research and Development Authority for the development of an anti-influenza treatment known as Laninamivir.
The Board of Directors for both companies have voiced their support for the merger, but approval from shareholders from both Nabi and Biota are needed before the deal can be finalized. Nabi's Board of Directors has already recommended that shareholders approve the proposed deal, determining that it represents their best interests. Nabi announced that it expects the merger to close in the third quarter of 2012 after receiving approval from Australian courts and Maryland-based regulatory agencies.
Source: MarketWatch, "Nabi Biopharmaceuticals Announces Definitive Merger Agreement With Biota Holdings Limited," April 23, 2012