breaking news: ventracor buyout deal collapses

BREAKING NEWS: Ventracor buyout deal collapses *Updated*

Nick Evans
Monday, 22 June 2009

THE deal to sell Ventracor has collapsed, leaving the company, staff, and its left ventricular device in limbo.

VentrAssist

Company administrators Ferrier Hodgson apparently told staff this morning that the deal for shell company Siqro, which BTN understands is a holding vehicle for United States heart device company Orqis, fell apart over the weekend, leaving the company and its staff in limbo.

Ferrier Hodgson released a deed of company arrangement late last week that would have seen Siqro take control of the Australian heart device maker by the end of July, recapitalising the company and returning its VentrAssist devices back into clinical development.

Shareholder activist group Save Ventracor, which has been actively seeking alternative recapitalisation proposals for the troubled company, threatened to block the move in the New South Wales courts in response, but that move may not be necessary, with Siqro withdrawing its purchase offer over the weekend.

BTN understands the proposal collapsed after Orqis’ financial backers withdrew their support from the proposal, concerned at a plan to merge both companies into the Siqro shell.

While BTN understands that the Save Ventracor group is still seeking the administrator’s support for new recapitalisation proposals, as yet unconfirmed rumours indicate that Ventracor may be sent into liquidation as early as this evening, and that Orqis itself may file for bankruptcy protection in the US as a consequence of the deal’s collapse.

A representative from Ferrier Hodgson, however, contacted BTN shortly after this story initially went to print and denied the company would be sent into liquidation immediately.

They said the company was still subject to the DOCA, but were not able to tell BTN what the administrators immediate plans for the company would be.

BTN will continue to update this story as more information comes to hand.