28th Sep 2018 11:42
LONDON (Alliance News) - Shares rose in TyraTech Inc on Friday as it reported a rise in revenue for the first half of 2018, and accepted an agreement by American Vanguard Corp to acquire all TyraTech shares it does not already own.
Shares in the life sciences company rose 32% at 2.97 pence on Friday.
For the six months to the end of June, TyraTech's pretax loss widened to USD1.9 million from USD1.7 million, due to the lack of a gain on the sale of an intellectual property made the prior year.
This was in spite of a rise in gross revenue to GBP843,000 from GBP490,000, the increase coming from the transaction services agreement following the sale of the head-lice Vamousse brand in December for USD17.5 million to Alliance Pharma PLC.
In addition, TyraTech said it signed an agreement with 34% shareholder American Vanguard Corp for American Vanguard to acquire the remaining stock it does not already own for 3.15 pence per share.
The price reflects a 54% premium over the TyraTech's Wednesday closing price at 2.05 pence.
The merger agreement is conditional on gaining at least 75% of shareholder approval at a general meeting on October 26. TyraTech has recommended that shareholders approve the deal, otherwise it said the company's financial situation is "not sustainable".
Should the merger be approved, it is expected to be completed in November 6, resulting in TyraTech's shares being cancelled from AIM.
"In December 2017 when writing to shareholders concerning the disposal of Vamousse and the return of capital to TyraTech shareholders, we explained that we believed that the company's animal health business was capable of being developed to serve much larger markets than its initial products, but that this would require additional funding. However, this funding has not been forthcoming. Accordingly, we have decided to enter into the conditional Merger Agreement with AMVAC," said Chairman Jose Barella.
"The independent directors believe TyraTech's shareholders, employees and business will be better positioned following the company's acquisition by AMVAC than if TyraTech had remained as an independent entity," Barella added.