Creditors to swap debt for shares

Creditors of ICP Biotechnology, including major shareholder Viking Capital, intend to swap the debt for shares in the company.

Viking, founded last year by former Dorchester Pacific managing director Brent King, owns 19 per cent of ICP Bio, but plans to take its stake in the company up to 35 per cent by converting about $4 million of ICP Bio's debt to it into shares.

Another unnamed group of creditors plans to convert up to $2 millon of debt into ICP Bio shares.

Mr King, who is also an ICP Bio director, said the unnamed group of creditors - mostly suppliers of goods and services - had seen that ICP Bio was now "turning the corner" and wanted to share in the future prospects of the company.

"Viking has spent a lot of time restructuring ICP Bio, and we are now feeling okay about its prospects."

ICP Bio is one of New Zealand's longest established biotechnology companies involved in the manufacture and marketing of products for use in animal reproduction, animal healthcare and the fine biochemicals field.

The company hit serious turbulence earlier this year when it announced it was going to fall well short of revenue targets for the financial period to June 30.

Then managing director Earl Stevens left suddenly.

Last month ICP Bio announced a loss of $13.5 million for the year.

It has subsequently raised $6.6 million in a rights issue.

Viking shareholders will be voting to approve taking the company's stake in ICP Bio up to 35 per cent at Viking's annual meeting in Auckland next Friday.

ICP Bio shareholders will meet the following the Viking move, plus the converting of debt into shares by the other creditors.

- © Fairfax NZ News