The boards of Denmark's Medical Prognosis Institute A/S and Oncology Venture Sweden AB agreed to merge the two companies to create an integrated oncology biotechnology company.
Oncology Venture shareholders will receive 1.8524 Medical Prognosis Institute shares in for each share in OV. About 51.3% of the merged entity will be held by OV shareholders. The boards of the companies want to implement the transaction via a statutory cross border merger.
The combined entity will continue developing Oncology Venture's anticancer drug pipeline while using Medical Prognosis' proprietary patient screening technology.
The merger is subject to approval by shareholders of both companies, with over 50% of OV shareholders and more than 70% of MPI shareholders planning to vote in favor of the deal.
Annual operating synergies are estimated to top 2 million Swedish kronor, and are expected to be realized, at the latest, two years following the merger.
Medical Prognosis Institute will be the continuing legal entity, and the merged company is expected to be called Oncology Venture. The merged company will remain listed on Nasdaq First North Stockholm and be headquartered in Hørsholm, Denmark.
The merger agreement is subject to automatic termination after Sept. 30.
EY Transaction Advisory acted as financial adviser to Medical Prognosis. KPMG Valuation Advisors and Dragon Financial Partners acted as financial advisers to Oncology Venture.
Medical Prognosis develops personalized medicine using its Drug Response Predictor tool, which determines potential patient responses to a database of more than 80 treatments. The company owns 8.45% of Oncology Venture as of the merger announcement, along with warrants to buy about a further 1.44% stake.
Oncology Venture develops anticancer drugs through its Denmark-based unit Oncology Venture ApS. The company has an exclusive license to Medical Prognosis' Drug Response Predictor tool, which it uses to improve clinical trial success rates.
As of March 8, US$1 was equivalent to 8.26 Swedish kronor.
