The board of the genetically modified salmon producer AquaBounty Technologies said it could not decide on whether or not to recommend the buyout offer extended by Intrexon for the company's shares.
AquaBounty's chairman Richard Clothier and non-executive director Richard Huber, the only two AquaBounty directors with shares in the company, said they would not take up the buyout offer extended by Intrexon for the company's London-listed shares.
The directors, which only hold 1.34% of the group's share capital, said they believe the "company's future interests are best served by continuing to be a publicly traded company".
However, the board said it was not able to make a decision on whether or not to recommend shareholders to accept the offer.
The problem lies around the continuing uncertainty over the pending US Food and Drug Administration's (FDA) approval for the product to be marketed, it said.
"The directors continue to believe that, were FDA approval to be received, the market potential for AquAdvantage Salmon and other AquaBounty products could be substantial," the board said in a notice to the London stock exchange on Dec. 5.
"However, shareholders should also note that the company has not received further information on the status of its FDA application subsequent [since Sept. 25] and there are no guarantees that the company will receive FDA approval in the future or, in the event that it does, that there would be consumer acceptance of the company's AquAdvantage fish products," it said.
The US biotechnology company Intrexon acquired 48% of AquaBounty from Linnaeus Capital Partners' Tethys Ocean subsidiary on Nov. 1 for $6 million in cash.
As a result Intrexon will now extend an offer at $0.123 per share for the rest of the company's shares.
Meanwhile, AquaBounty said it had received a short-term bridge loan financing of $500,000 by Intrexon to cover its working capital requirements until an equity fundraising can be completed. The terms of the loan include an interest rate of 3%, a maturity of 180 days, and repayment through the proceeds of a capital raising transaction.
The loan means the company will have sufficient capital, combined with tight cost control, to continue operations until March 2013, the board said.