Perth-based global drug delivery company, pSivida Ltd has announced that it proposes to reincorporate in the United States.
Perth-based global drug delivery company, pSivida Ltd has announced that it proposes to reincorporate in the United States.
The reincorporation, which is subject to Australian Federal Court and shareholder approval, will occur in mid-2008.
After the reincorporation, pSivida will maintain listings on the ASX, NASDAQ and the Frankfurt Stock Exchange.
The company's current business, operations, directors and management will not change as a result of the reincorporation.
The full announcement is pasted below:
pSivida Ltd today announced that it proposes to reincorporate in the United States.
The reincorporation, which is subject to Australian Federal Court and shareholder approval, will occur in mid-2008.
This reincorporation is designed to make the Company a more attractive investment for shareholders by increasing the potential scope and depth of the Company's shareholder base and liquidity while maintaining strong ties with the Australian investor base.
After the reincorporation, the Company will maintain listings on the ASX, NASDAQ and the Frankfurt Stock Exchange. The Company's current business, operations, directors and management will not change as a result of the reincorporation.
"With our increased focus on the US, Pfizer has become our largest stockholder and a collaborative partner to develop ophthalmic products.
Our phase III product, MedidurTM FA for DME, is fully funded by another US partner, Alimera Sciences.
We refocused our operations by selling non-core businesses.
Through these actions, we have provided ongoing funding to the company and have greatly strengthened our financial position," said Dr. Paul Ashton, managing director.
"Most of our operations are now in the US, and with our operational and strategic successes, we are ready to reincorporate in the US, the next step in our previously announced strategy of building a global drug delivery company."
The Board has unanimously concluded that the proposed reincorporation is in the best interests of shareholders and has unanimously recommended its approval.
An Australian-based independent expert engaged as required by Australian law to evaluate the proposed reincorporation has also concluded that it is in the best interests of shareholders.
The Board believes the proposed reincorporation has key potential benefits for shareholders
including:
- Focus growth and development where the Company has achieved its recent business
- successes.
- Enhance US-based demand for the Company's securities.
- Continue strong connection with Australian investor community.
- Reduce ongoing compliance costs.
- Continue engagement of Deloitte Touche Tohmatsu, the Company's independent auditor.
- Eliminate depositary fees paid by ADS holders without creating depositary fees paid by CDI holders.
Outline of the Proposed Reincorporation:
The reincorporation is proposed to be effected as a scheme of reconstruction under Australian law.
For the reincorporation to be accomplished, unless the Court orders otherwise, more than 50% of voting shareholders and 75% of the shares voted must approve the reincorporation.
The Australian Federal Court must also approve the reincorporation.
If approved, the following will occur by Court order:
- All outstanding shares of the Company will be transferred to a new company incorporated in the US. Shares of the new US company will be listed on NASDAQ and the Frankfurt Stock
- Exchange, and CDIs will be listed on the ASX and Frankfurt Stock Exchange.
- In exchange, a new US company will issue one of its shares for each 4 ADSs of the Company and one of its CDIs for each 40 ordinary shares of the Company.
- Cash will be paid for fractional shares.
- All assets and liabilities of the Company will be transferred to and assumed by the new US
- company.
- Outstanding options and warrants will be equitably adjusted to reflect the reincorporation.
- Shares in the Company's subsidiaries will be transferred to the new US company.
The reincorporation is subject to various conditions, including obtaining regulatory approvals, a primary listing for the new US company on NASDAQ and a full foreign listing on ASX.
A shareholders meeting will be held to approve the reincorporation.
Before the meeting, shareholders will receive an information memorandum, including the opinion of the independent expert, which will include a complete explanation of the proposed reincorporation.
