(Alliance News) - Ashington Innovation PLC on Thursday said it agreed to acquire in Cell Therapy Ltd in a GBP135 million reverse takeover, resulting in its own shares being suspended from trading in London.
As part of the transaction, the special purpose acquisition company said it plans to carry out a placing of new shares to new and existing investors, aiming to raise up to GBP3 million to finance a drug development program and provide working capital.
The transaction is conditional on the completion of due diligence, regulatory approvals from the UK Financial Conduct Authority and Takeover Panel, a successful placing of shares and shareholder approval, among other conditions.
Ashington Innovation, which began trading on London's Main Market in early June, said Cell Therapy is a clinical stage biotechnology firm with a portfolio of patented cellular medicines and a lead programme that "successfully completed an early-stage human clinical trial in heart failure".
Cell Therapy has been granted patents in the US, UK, EU and Asia, Ashington Innovation said.
Ashington Innovation said it considers the transaction to be "transformational" and "value enhancing" for shareholders, as well as being "fully aligned" with the company's growth strategy.
As the transaction would represent a reverse takeover, Ashington Innovation's shares were suspended from trading in London on Thursday, pending the publication of a prospectus or the deal collapsing, as required under the London Stock Exchange listing rules.
Ashington Innovation said there can be no guarantee that the proposed transaction will complete, nor confirm its final terms, and that the company will provide further updates in "due course".
"We are delighted to have agreed a heads of terms to acquire Cell Therapy. During the past few months, we have reviewed numerous projects and believe the proposed acquisition meets our stated objective of identifying a potentially extremely valuable entity capable of sustainable development and with significant technological advantages," said Ashington Innovation Founder & Director Jason Smart.
"The directors believe that the regenerative medicine and biotechnology sector presents compelling opportunities to create value for shareholders and the proposed acquisition presents a high-quality target with an experienced and expert leadership. This is a very exciting opportunity to bring a scalable business with a strong track record to the public markets."
By Greg Rosenvinge, Alliance News reporter
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