Admedus Ltd (ASX:AHZ) has made further progress towards spinning off and securing up to $18 million funding for its immunotherapies business, Admedus Vaccines Pty Ltd.
AHZ’s wholly owned subsidiary Admedus Investments Pty Ltd (AIPL) has entered into a share sale agreement with Constellation Therapeutics and the other shareholders of Admedus Vaccines whereby Constellation would acquire all the shares of Admedus Vaccines.
READ: Admedus progressing towards securing $18 million investment for immunotherapies division
On completion of the transaction:
• Admedus Vaccines will be a wholly-owned subsidiary of Constellation;
• AHZ will hold a 29.13% interest in Constellation through AIPL;
• Other current Admedus Vaccines shareholders (excluding AIPL) will hold 10.8% of Constellation;
• Sun Bright Holdings, an associated entity of Star Bright Holding will hold a 60% interest in Constellation (note that Star Bright and its related entities own 22.5% of the issued shares in AHZ);
• Sun Bright will contribute up to $18 million to Admedus Vaccines over the period to November 2022 to meet ongoing funding requirements; and
• AHZ chief executive Wayne Paterson will be appointed as the chairman of Constellation, and Professor Ian Frazer will be appointed as a consultant to oversee the vaccine and immunotherapies development.
Payments on achieving milestones
The subscription agreement provides that Sun Bright must pay five instalments of $3.6 million each linked to Constellation achieving certain milestones.
If Sun Bright fails to pay all or part of an instalment, then for each instalment not fully paid, 12% of its shares in Constellation will be transferred to AIPL and the other existing shareholders in Admedus Vaccines.
The immunotherapies transaction remains subject to a number of conditions, including the signing of the subscription agreement, which means it is not currently certain the transaction will proceed.