AOS and Swift terminate $20m sale and purchase agreement

South Perth-based ophthalmology company Advanced Ocular Systems Ltd has suffered a setback in its restructuring plans with the termination of a proposed $20 million sale and purchase agreement with Swift Venture Holdings Corporation.

The full annoucement is pasted below:

Further to our announcements of 6 February 2008 and 21 February 2008, the board of Advanced Ocular Systems Ltd (AOS) wishes to advise that the proposed sale of various ophthalmic assets under the sale and purchase agreement entered into between AOS and Swift Venture Holdings Corporation (Swift) has been terminated by the mutual agreement of the Parties.

Swift is a public company listed on the Singapore Stock Exchange and an entity contemplated to become a wholly owned subsidiary of Oculus Ltd.

The reason for termination of the S&P Agreement is as a result of deteriorating financial conditions in global markets as well as the corresponding decline in the share price of both AOS and Oculus since the transaction was first announced, which has adversely affected the purchase consideration to be received by AOS.

This has rendered the proposed transaction economically unfeasible for both AOS and Oculus shareholders.

While AOS and Oculus have agreed to continue reviewing the position with regard to the Assets, any decision to proceed in the future would be based on new terms and conditions in their entirety.

Notwithstanding the termination of the S&P Agreement with Swift, the board of AOS considers the value of its ophthalmic assets to be intact with the commencement of royalty income from the Alcon license due in the current quarter and continuing royalties from the Lenstec, Inc licenses.

In addition, AOS is still exploring the strategic development of the Omnifocal lens given the significant lift in the profile of these lenses following the recent purchase of IOL maker Eyeonics Inc by Bausch & Lombe for over US$300 million.

AOS will provide a further update on its activities as appropriate with the lodgement of its Appendix 4C quarterly report at the end of April.