BioWorld International Correspondent

LONDON - PPL Therapeutics plc said it was "almost certain" to go into liquidation after failing to get the support of a major shareholder for a 5.5 pence per-share offer for the collapsed company.

The offer to buy what remains of the company that nurtured Dolly the cloned sheep valued PPL at about £6.7 million (US$12.3 million). It was made by Lindsay Dunsmuir, chief financial officer, and Adam Christie, business development director, who proposed to take on and develop PPL's sole remaining technology asset - fibrin-1, a wound sealant - dispose of the other assets and delist the company.

That proposal was recommended as the best offer by the company's independent nonexecutive directors, headed by Chairman Chris Greig, and received the informal acceptance of 30 percent of PPL's shareholders. However, one major investor, understood to be the hedge fund Metage Capital Ltd., owner of a 21 percent stake, blocked the move.

In a statement last week Greig warned shareholders if the deal did not go through PPL would be placed in "the lengthy and uncertain process" of voluntary liquidation. Greig said Dunsmuir and Christie's bid offered shareholders more certainty and higher value than any other proposal PPL had received.

Despite continuing discussions the major shareholder refused to support the bid, and on Monday Greig said it had been decided not to proceed with the plan to sell PPL to Dunsmuir and Christie.

At the last count in August, PPL had £9.3 million in cash. Since then it has been selling off its assets, including laboratories and equipment, the farms where it raised its transgenic animals and its intellectual property. A PPL spokesman told BioWorld International, "The various sales may have brought cash in, but it is costing to run the business. It has taken nine to 10 months to get this far, and the cash burn is going on."

He added voluntary liquidation would take a significant amount of time to complete. "The remaining shareholders could end up with less [than 5.5 pence per share]," he said.

PPL was left with no choice but to wind itself up last September after a deal with Bayer Healthcare LLC for alpha-1-antitrypsin was put on hold. Previous delays with the program had forced PPL to write off a £7.5 million investment in a manufacturing plant. That left fibrin-1 as PPL's lead product, but the then management failed to get shareholder approval for its plan to restructure the company around that product.