Biota aims to raise $13m in share purchase plan

Biota (ASX:BTA) is offering shareholders a chance to buy up to AUD$5000 worth of shares at a 10 per cent discount to the market price, the company announced today.

The share purchase plan is part of the company's strategy to rebuild shareholder value, said CFO Andrew Macdonald. "We are looking at merger and acquisition opportunities and clearly we hope to enter into one of these in the next 12 months," Macdonald said.

The offer, which has been capped at around 24 million shares, could raise as much as $13 million for the company. The funds raised will serve a twofold purpose, said Macdonald, both to bolster existing cash reserves and to fund ongoing R&D activities.

"We want to make sure we are managing our cash position very carefully," he said.

Biota is unusual in having around 16,000 shareholders, with around 4900 holding less than a marketable parcel of $500 worth of shares.

"We're hoping that a good number of small shareholders will take up the offer," said Macdonald.

The offer price will be based on the volume weighted average share price in the five trading days immediately prior to September 19, and the offer will close on the October 21. The discount is the same as that offered to institutional investors, Macdonald said.

Biota's share price dropped 3 per cent to close at $0.60.