Hunter Immunology agrees to Probiomics merger

Drug development company Hunter Immunology has agreed to be acquired by biotech Probiomics (ASX:PCC) in a reverse takeover, and to list the merged entity on the ASX.

Probiomics announced its reverse takeover bid in October, revealing it expects the combined company to have a market capitalisation of $37.2 million.

The board of Hunter Immunology has voted to recommend the offer to investors, and the company's four largest shareholders, owning over 45% of the company, have already indicated they will accept.

Hunter Immunology is currently developing a vaccine to treat chronic obstructive pulmonary diseases (COPD) including chronic bronchitis and emphysema.

The company is in the final stages of phase IIb clinical trials involving 320 patients across 21 Australian hospitals. Results from the trial are scheduled to be released in April 2012.

The preceding phase IIa trial showed a reduction in hospital admissions for COPD patients by 90%.

If the merger is approved by shareholders, the combined company will be lead by Hunter Immunology CEO David Radford. It will be listed on the ASX in March 2012.

The transaction terms involve the issue of nine Probiomics shares, valued at $0.011 each, for every one Hunter Immunology share valued at $0.099.