Perth PDF moves to become a biotech

One of Australia's oldest pooled development funds wants to toss in the towel as an investment vehicle to merge with its most promising holding, Perth biomed Clinical Cell Culture (C3).

The listed fund, ECAT Development Capital, wants shareholders to endorse moves that would lift their current 35 per cent stake in Clinical Cell Culture to 100 per cent in a cash and shares deal.

If all goes according to plan, C3 will emerge in early October as a publicly-listed company in its own right after being backed into ECAT's ASX listing.

ECAT is the third-oldest PDF and has about $6.5 million in the bank, but like many smaller investment funds, finds itself in a difficult position in current market conditions.

Its shares are trading at a significant discount to its net asset backing and directors believe that ownership of C3 will offer shareholders more promising future returns.

ECAT has already put $2.5 million into C3, making it the largest of its investments by an order of magnitude.

The move to full ownership will see C3 shareholders offered ECAT shares and options plus $1.37 million in cash.

Clinical Cell Culture, formed in 1999, develops and distributes tissue-engineered cellular skin replacement products. Its first product, CellSpray, is on the market and another six are in the various stages of development, from R&D to clinical trials. C3 products have initial applications in the treatment of burns with broader potential to expand into wound care and cosmetic surgery applications.