Biortica Agrimed is preparing to launch a public offer seeking up to A$5 million as it advances a backdoor listing on the Australian Securities Exchange (ASX) through a deal with Bod Science shareholders.
A deed of company arrangement (DOCA) was executed between the two companies today, opening the path for Biortica to effectively take over Bod, pending approval from Bod shareholders in January.
Under the terms of the share purchase agreement, Biortica will become a wholly owned subsidiary of Bod, while Biortica shareholders will receive ordinary shares in Bod.
The merged entity will then need to re-comply with ASX listing rules before the backdoor listing can be finalised.
The ASX has already confirmed that Biortica has a "structure and operations suitable for a company to be admitted to the official list of the ASX" following lodgement for “in principle” advice from the exchange.
If Bod shareholders approve the agreement in January, Biortica will contribute $380,000 to a deed fund, with a number of Bod assets also transferred into the fund to cover payments to secured creditors.
Once the DOCA is finalised, Bod Science's chair and directors will step down and be replaced by Biortica's senior management team. A capital raise will then follow, targeting between $1m and $5m through the sale of up to 6.6 million shares priced at $0.75c each.
The capital raise is scheduled for March, with proceeds earmarked for working capital.
A timetable lodged with the ASX shows that Bod Science will rebrand as Biortica before pursuing reinstatement to the exchange.
Following completion of the proposed acquisition, existing Bod shareholders and Biortica shareholders will hold approximately 1.28% and 98.19% of the combined company respectively, Bod administrator Andrew Barnden said in an ASX filing.
"There will therefore be a concentration of ownership of the combined group among Biortica shareholders," he said. "This may allow the Biortica shareholders to exert significant influence over matters relating to the combined group, including the election of directors or the approval of future transactions."
