Pharmaceutical company AGI Therapeutics is to be swallowed up by Aravis Therapeutics, a recently formed Irish subsidiary of Altiva.
The board of AGI is recommending an offer from Aravis which values AGI at about $8.4m (€6.6m). Aravis is offering 11.71 cents in cash for each AGI share they own.
Prior to the announcement of the agreed bid AGI Therapeutics shares were trading at 4.5p (around 7 US cents), and rose to 7.12p (around 11 cents) on the news.
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AGI shareholders who accept the offer will be able to take the readies in either US dollars or euros. If they elect to take the money in euros, the amount they receive will be determined by the US dollar/euro exchange rate on the day the offer is declared wholly unconditional.
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"We believe the offer represents an attractive premium relative to our recent share price trading history and when the offer is considered alongside other alternatives the offer represents the best outcome for shareholders," said Ronan Lambe, the non-executive Chairman of AGI.
The decision of the board of AGI to give up its independence was made easier by the outcome of discussions with potential development partners for its sole remaining drug in development: AGI-350. These discussions made it apparent that the company was unlikely to find a development partner for the early-stage-of-development drug within a reasonable time frame, while the current state of global financial markets would make it very difficult for the company to raise finance on reasonable terms to go it alone in developing the drug.
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