The purpose of merger is to create synergy. Drug discovery...

The purpose of merger is to create synergy.

Drug discovery companies have a long history of being bullied by big pharmas in terms of licensing deals. By merging to become a bigger company with more pipelines in development along a time period can create a more sustainable portfolio of pipelines and hence reduce business risk of the company. With bigger size of company and more sustainable portfolio of pipelines, the company can more easily raise captal from the financial market to more deeply advance its pipelines and prabably take the pipelines directly to the market by itself.

The US financial market is, no doubt, much much bigger than Austrlain fianncial market. At the moment, funds in Australia mostly focus on mining industry and banking industry because of the profits of the two industries over the recent years are much better due to mining boom and real estate boom respectively, IMO.

Many of us here believe that current Biota's pipelines should have a value of > $5 dollars per share if those the value of those pipelines are deeply realized. But, the question is "can BTA realize the value of those pipelines?". At the moment, it is obvious that it is very difficult for BTA to realize the most value of those pipelines. So, merger with a US company to become a new US company is the option to more deeply extract the value of Biota's pipelines. If, say, the new company can realize the $5 value of the pipelines, isn't it reasonable for BTA shareholder to pay , say, $2 to the merger target company? I think it is reasonable. So, I would not be too worried about merger with a US company as long as the new company can still realize $3 value per share out of Biota's current pipelines for Biota shareholders.


Just my thoughts.