Ambri on the hunt for M&A targets

Sydney-based Ambri (ASX:ABI) is looking to merge with another medical diagnostics company with products that are closer to market.

The ideal merger target would have product now, "which is what we lack," said Ambri managing director and CEO Roman Zwolenski. "Also, ideally, they would see a future with our technology in their next generation of product."

Ambri is currently developing a biosensor chip using proprietary ion channel switch (ICS) technology to test for multiple diseases such as influenza A and diabetes.

"It is clear that it will be several years before ICS technology will be in the form of a product available for sale," said Ambri chairman John Grant at the company's AGM yesterday.

"Accordingly, the board is of the view that the company should merge with a compatible enterprise that is nearer to product revenues."

Zwolenski said that Amrbi could offer "a team of people that are skilled in biosensor technology that also spans the basic sciences of medical diagnostics".

The company also has "technology that is outstanding in its potential for multiple testing at the point of care," he said. "That's what we're trying to prove, but it is longer term."

While Ambri has been "actively investigating M&A opportunities" in the past few months, Grant said the company can't make any announcements yet.

A merger is expected in a matter of months. "Just the fact that we've announced that we're doing it means that we think this is extremely urgent," said Zwolenski.

Ambri's loss for 2004-05 was AUD$8.95 million, down from $11.41 million in the previous year. The company's cash burn has been reduced from $809.000 per month in the previous year to $447,000 per month in the quarter ended September 30.

"We'd like to be advancing faster with our development program but we did cut back with the view that we couldn't move as quickly," said Zwolenski. "This puts us in a healthy commercial business position."

At the end of September, Ambri had cash of $9.6 million.